January 31, 2009

More Tax Aversion from the Tax-and-Spend Left

Justin Katz

I'm sure Tom Daschle had every intention of filing three years of amended tax returns (one for every year since he was bumped from public office, I believe) whether or not he'd been presented with the opportunity of joining the Obama administration:

Thomas A. Daschle recently filed amended tax returns for 2005, 2006 and 2007 reporting $128,203 in additional tax and $11,964 in interest. The adjustments resulted from additional income for consulting services and the use of a car service, and reductions in charitable contribution deductions. Senator Daschle filed the amended returns voluntarily after Barack Obama announced his intention to nominate the senator to be the Secretary of Health and Human Services. The Presidential Transition Team identified the charitable contribution issue and Senator Daschle self-identified the income adjustments.

If not, citizens of the United States of America — even those who support the current president — might have reason to question whether Mr. Daschle possesses the ethical fortitude to hold appointed office.

What Does Handing Out Drivers Licenses to Undocumented Immigrants Have to Do with Regulating the Sale of Alcoholic Beverages?

Monique Chartier

It appears that Senator Charles Levesque (D-Bristol, Portsmouth) is once again attempting, minus the kickback, to pick up the slack left by Dolores Rodrigues LaFlamme. Incongruently buried in Bill S0142 entitled "An Act Relating to Alcoholic Beverages -- Regulation of Sales" is a substantial modification of the requirements to obtain a Rhode Island drivers license or official state identification; namely, the requirement to demonstrate proof of citizenship or legal residency. In fact, page seven, lines 23 - 25 explicitly state

Proof of lawful presence in the United States shall not be required in order to qualify for an operator's license. An applicant shall not be denied an operator's license based solely upon his/her immigration status.

Why is this being done stealthily, under the cover of a completely unrelated bill? If modification of such requirements is a good idea, why can it not be a separate, properly labeled bill, the merits of which can then be openly debated?

The Process of Reigning

Justin Katz

I'm increasingly noticing the degree to which procedural minutia affect the balance of power in the disputes resolved among the lower tiers of government. The reality was stark at the last financial town meeting in Tiverton, but even in the day-to-day operations, one must weave through various traps and catches in order to bring about a particular policy. It becomes, essentially, an extra-judicial battle of lawyers.

That sense struck me during a conversation at the latest Tiverton town council meeting concerning a motion to permit the town administrator to send another draft of the next budget to the budget committee (stream, download). This exchange, in particular, makes me think that there's some defense being built of which the casual follower would remain unaware:

Ed Roderick: Isn't there a requirement that the council get this budget to the budget committee by a certain date, and we already exceeded that date?

Louise Durfee: They have it. They do have it. So, we haven't withdrawn it, I mean, so, you know...

Joanne Arruda: They can certainly work with what they have.

Roderick: I believe the wording is "an approved budget."

Durfee: Yeah, but is it "approved" really?

Arruda: It's a recommendation. It's a...

Roderick: It's a working budget?

Durfee: Yeah, it's very much of a...

Arruda: Proposed.

Roderick: I just want everybody to be cognizant that it is a requirement that we get it to the budget committee.

Be it an approved proposed recommendation, the fact is that the town council submitted a budget with which to begin the process, and it was one that would require significant tax increases on struggling residents.

A Faster Fall in Rhode Island

Justin Katz

Slipping from 5.2% to 10%, Rhode Island led the nation in unemployment growth:

The rise in Rhode Island's unemployment rate led the nation last year, according to new data from the U.S. Department of Labor.

Only North Carolina, where unemployment grew by 4 percentage points, and Nevada, where it increased by 3.9 percentage points, approached the 4.8 percentage-point spike in Rhode Island.

Rhode Island's year-end unemployment rate, 10 percent, was not the worst in the country; that was Michigan's ignominy.

But the Ocean State's economy is by far the most troubled in New England. Connecticut, where 7.1 percent of job seekers could not find jobs last month, has the region's second-highest jobless rate. It is followed by Maine (7 percent), Massachusetts (6.9 percent), Vermont (6.4 percent) and New Hampshire (4.6 percent).

It's past time we rewrite the owner's manual for our state. The governor's latest budget proposal took (ultimately modest) steps in the right direction, and it's been nearly unbearable to watch the General Assembly twiddle its thumbs with hearings, as if waiting for the windfall de l'année to tumble down from Mount Obama.

Citizens and officials alike must realize that the year will come when no surprise miracle money will be available, and the longer we wait to retool the state — to make it an economic leader in New England — the farther will be our fall.

Making Education Fit the Budget in Cranston

Justin Katz

The scythe has come out in the Cranston school department:

Gifted and talented programs? Gone. Middle school sports? Gone. Music lessons for children who want to play stringed instruments? Gone.

These programs and others are among the casualties in the budget proposed by Schools Supt. M. Richard Scherza for the coming fiscal year, and the picture could get worse.

Looking to make up for projected cuts in state aid, Scherza has proposed a 2009-10 budget that would raise spending less than 1 percent in the year that begins July 1.

To hold to that figure, he has eliminated a number of programs not required by law, regulation or contract, creating a list of casualties that also includes a summer reading program for elementary students, and hockey and girls cross-country at Cranston High School East.

That's in addition to cutting positions — five technical assistants, a social worker, an elementary guidance counselor, a special-education administrator — and reducing spending in a number of areas, including library books, supplies and transportation.

With that in the news, I thought I'd add Cranston to my series of charts illustrating per-student spending trends in a number of Rhode Island municipalities:

A Conclusion for All Evidence

Justin Katz

The article quotes scientist after scientist declaring that "this means we must act quickly," but it seems to me a forced reaction to the new information:

Many damaging effects of climate change are already basically irreversible, researchers declared Monday, warning that even if carbon emissions can somehow be halted temperatures around the globe will remain high until at least the year 3000.

"People have imagined that if we stopped emitting carbon dioxide the climate would go back to normal in 100 years, 200 years; that's not true," climate researcher Susan Solomon said in a teleconference.

Solomon, of the National Oceanic and Atmospheric Administration's Earth System Research Laboratory in Boulder, Colo., is lead author of an international team's paper reporting irreversible damage from climate change, being published in Tuesday's edition of Proceedings of the National Academy of Sciences.

She defines "irreversible" as change that would remain for 1,000 years even if humans stopped adding carbon to the atmosphere immediately.

I take that to suggest that climate change (broadly speaking) is a long-term process to which no short-term contributions will have immediate effects. If that conclusion has an effect on policy, it ought to make our steps more measured, because irreversibility is not a threshold, in this case, but a degree. It's not no problem versus perpetual problem; the problem merely grows until it crosses an arbitrary line of really-bad-ness, and wreaking drastic changes to our short-term economy would cause immediate harm to the global community.

It doesn't much matter to a starving family whether the condition persists for 50 years or 1,000.

January 30, 2009

A Get What You Can Society

Justin Katz

It's difficult not to rub one's eyes and look again:

Despite crippling losses, multibillion-dollar bailouts and the passing of some of the most prominent names in the business, employees at financial companies in New York, the now-diminished world capital of capital, collected an estimated $18.4 billion in bonuses for the year.

That was the sixth-largest haul on record, according to a report released Wednesday by the New York State comptroller.

That's the culture, though: Whether left, right, or center, take what you can. For their part, lefties and unionists can hardly complain on principle, but only on scale. News from Tiverton:

Two senior officers in Tiverton's police department have announced their imminent retirements. They are Deputy Chief Nicholas A. Maltais, 42, and Detective Sergeant Charles R. Mulcahy, 44.

Deputy Chief Nicholas A. Maltais will retire effective March 30, 2009. Although known for some time to have been considering retirement — he’s been with the department for 21 years — the timing of his departure now is in part related to pension reduction proposals outlined by Governor Donald Carcieri that would take effect April 1. That cutoff date is causing public employee retirements statewide. ...

Deputy Maltais earns $67,322 annually. When he retires he will have 145 days of unused sick leave that the town will buy out in a lump sum for an estimated $38,000.

Sergeant Mulcahy, who could not be reached for comment, earns a salary estimated at $56,000, according to town budget documents. His unused sick leave, and the amount of any town buyout, are unknown.

Both men will draw pensions from the police pension fund that equal 52 percent of the average of their three highest years with the department. Deputy Maltais is entitled to approximately $35,000 annually.

If Maltais lives to be 80, his total payments will be $2,420,581, or $115,266 for each year that he worked. Forty-five percent of that number, $1,090,581, is due to cost-of-living increases. In the 38th year of his pension, the payment will be $104,482.90. (That strikes even me as a very high number, so please correct me if I've erred in my calculations.)

Says Maltais:

"I feel comfortable in my decision to retire at this time. I'm looking into other opportunities. I really value family and look forward to spending time with my two sons. This is time you never get back."

Many a private-sector father knows the feeling, although most of us have no option but to watch the time slip away from behind our desks, our steering wheels, or our machine controls.

401k, 401k, Wherefore art thou oh 401k?

Marc Comtois

John Kostrzewa's article on the failure of the 401(k) in this past Sunday's ProJo (which didn't go immediately on line, for some reason) hit home for many, I'm sure. He focuses on the fact that the 401(k) "system" requires rank amateurs to make relatively un-educated investment decisions. He has a point, but it's not just the untrained, risk-taking (or naive) investors who have taken a bath in this market. Even careful investors who take the time to educate themselves have been hit hard. I'm no financial wiz, but I do my homework and I've now got less in my 401(k) than what I've actually contributed over the past 12 years. The mattress would have been better (I kid....I think...). So, how did we get to rely on the 401(k) so much?

The reason for the tumult is that the self-guided 401(k) replaced defined-benefit plans in which companies guaranteed a pension for loyal workers. Under the pension plan system, companies assigned professionals to mange pools of money to make sure the funds would be there to cover a worker’s retirement.

But it was expensive. And Congress was convinced to expand the availability of the 401(k), which was written into law in 1978 and for years used only as a supplement to the pension and Social Security system.

The use of 401(k)s expanded as the philosophy of an “ownership society” took hold and the responsibility and risk of planning a financial future shifted to individuals. The 401(k) program grew to 50 million Americans with $2.5 trillion in total assets.

For awhile, during the bull markets, everybody seemed happy with the switch. But the bear market that has devalued stocks, and sliced 401(k) investments, has exposed the flaws.

It sure has. Kostrzewa mentions some possible solutions, but this WSJ piece by Anne Tergesen is much more in-depth. I still think the 401(k) is an important piece of the equation, but only a piece.

Perpetually Requiring a Helping Hand

Justin Katz

This will be the final post of our week of rattling the cup. Thank you to all who have donated and subscribed online, as well as to those whose snailmail donations have not yet arrived. Unless a substantial surprise awaits us, we're still a long way from the goal of funding a full-time job, but readers' generosity has certainly made it possible for us to forge ahead and expand our activities. As with the reclamation and recovery of Rhode Island, our advance will be incremental.

Although we're wrapping up our formal blogathon (so to speak), I'd note that the links to donate and subscribe will remain on the left-hand side of the page for use throughout the year. I'd also suggest, for those who are uncomfortable about or disinclined toward monetary contributions, that we'd welcome anything that might further our mission. Gift certificates, for example, to technology stores and such would help us to remained armed. If somebody were interested in helping us to fund Internet access via cell phone service, we'd be better able to generate content. And if readers would like more coverage of their regions of the state, gift subscriptions to local papers would not be wasted (but coordinate this one with me so that we avoid unnecessary duplications).

In similar fashion, we continue to request donations of effort. Engaged Citizen posts certainly advance our cause. Coverage of events that we cannot attend would expand the utility of the site.

But in the meantime:

Subscriptions of $0.25 per day (payments of $7.60 per month) and donations of any size may be made using credit cards via PayPal (no PayPal account is necessary) by clicking the following:

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A Very Brief Capsule Analysis of the RNC Chairman's Race

Carroll Andrew Morse

One thought I've heard from multiple Rhode Islanders keeping tabs on the Republican National Committee Chairman's election is that Mike Duncan would be the only bad choice, the reasoning being that Mr. Duncan takes the position that national party should focus only on Federal races and that state parties have to fend for themselves. There's great skepticism that this top-down philosophy (perhaps usual for the party?) can work given current political conditions.

The election is today. Chris Cillizza of the Washington Post has his last round of handicapping here.


Marc Comtois

Ben Stein (h/t) boils the "porkulus" package down:

I love this. The new kind of politics of hope. Eight hours of debate in the HR to pass a bill spending $820 billion, or roughly $102 billion per hour of debate.

Only ten per cent of the "stimulus" to be spent on 2009.

Close to half goes to entities that sponsor or employ or both members of the Service Employees International Union, federal, state, and municipal employee unions, or other Democrat-controlled unions.

This bill is sent to Congress after Obama has been in office for seven days. It is 680 pages long. According to my calculations, not one member of Congress read the entire bill before this vote. Obviously, it would have been impossible, given his schedule, for President Obama to have read the entire bill.

For the amount spent we could have given every unemployed person in the United States roughly $75,000.

We could give every person who had lost a job and is now passing through long-term unemployment of six months or longer roughly $300,000.

There has been pork barrel politics since there has been politics. The scale of this pork is beyond what had ever been imagined before -- and no one can be sure it will actually do much stimulation.

Disappointing Unionism

Justin Katz

Michael Morse is a good guy. A very good guy. He's reasonable, compassionate, and intelligent, but also emblematic of the cult of unionism. That such a man would not spare one word of sympathy for those appalled by the teachers' union tactics at the infamous East Providence school committee meeting or one word to disassociate his own union, or at least his own belief about unions, from the astonishing behavior illustrates how corrosive unionism can be to a community, how divisive the line around those who proclaim "solidarity." Union uber alles.

To Michael, Travis Rowley's recounting of the school committee meeting marks him as an "arrogant" purveyor of "vitriol." Yet, he offers no expression of regret that the National Education Association's Patrick Crowley has been increasingly successful at making his the face of Rhode Island unions. Michael speaks of the "potential allies" whom Travis has alienated, but if he means to indicate people under the union umbrella who might be uncomfortable with some actions of their peers, he does not give reason for confidence that he'd be willing to break ranks himself.

And so it has been. It was largely Lt. Michael Morse of the Providence Fire Department who finally convinced me of unions' insidious nature. Although I've considered him a friend, and although he reached out in camaraderie to the contributors of Anchor Rising, the union disagreement proved too much. He's scrubbed us from his blog, and apparently, we weren't able sufficiently to persuade him that our opposition to public sector unions is based on honest assessment that he'd step forward in public to display a union rift so that the broader community could begin to heal.

January 29, 2009

A Hub for the Opposition

Justin Katz

I've had reason to be optimistic, over the past few days, that the various isolated (and sometimes schismatic) groups that have thus far constituted the Rhode Island right (or center-right) are beginning to come together. The factors that bind us are of increasing importance, compared with those that tend to push us apart.

No doubt, key players are engaged in conversations behind the scenes, but I've found it particularly encouraging to see the town-level groups and individual citizens weaving together the various degrees of conservatism, leveraging the disparate tools provided by the state-level subgroups (e.g., organization by RISC and data from OSPRI). This process will continue, and as it does, we'll need a place, fundamentally independent from the rest, to hone our agreements and work on our disagreements — an informational hub and meeting place.

I suspect you know what I have in mind. Anchor Rising is uniquely positioned at the intersection of various pathways — media, community, research, reportage — and we hope to expand our activities in all directions. Among them is identifying and cultivating participants in the civil debate and political struggle.

Of course, that requires resources.

Subscriptions of $0.25 per day (payments of $7.60 per month) and donations of any size may be made using credit cards via PayPal (no PayPal account is necessary) by clicking the following:

Those who would prefer the more direct route of checks or money orders can make them out to Anchor Rising and send them to:

Anchor Rising
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Nationalizing Failure

Justin Katz

Yesterday, Marc and Monique noted that the "stimulus" sticker is being slapped on boxes of the Democrats favorite things. It may be the giddy air of Washington, these days, that brought forth from House Speaker Nancy Pelosi the comment: "Would we have ever thought we would see the day when we'd be using that terminology - 'nationalization of the banks?'"

With the direction in which the federal government is going, I fear that "stimulus" will prove to mean "national collapse." From the proximate link (emphasis added):

Many believe that form of hybrid ownership - part government, part private, with the responsibilities of ownership unclear - will not prove workable.

"The case for full nationalization is far stronger now than it was a few months ago," said Adam Posen, the deputy director of the Peterson Institute for International Economics. "If you don't own the majority, you don't get to fire the management, to wipe out the shareholders, to declare that you are just going to take the losses and start over. It's the mistake the Japanese made in the '90s.

"I would guess that sometime in the next few weeks, President Obama and Tim Geithner," he said, referring to the nominee for Treasury secretary, "will have to come out and say, 'It's much worse than we thought' and just bite the bullet."

That's speculation from a think-tanker, of course, but consider the prospect's implications. Bank management will face national politicization of their jobs. Private shareholders will have less incentive to invest. The federal government will have even more power to refashion our financial system based on its own impressions of economic reality and "social justice."

This path was mapped in the very first leap toward bailouts, last year, when America was assured of the necessity and everybody brushed off the natural tendencies of government as a consideration. The only question, at this point, is whether the stumbling beast can be stopped.

A Penny Taxed, a Penny Wasted

Justin Katz

Channel 12 reporter Tim White did some surveillance of the Providence Sewer Department and in part 1 revealed some observations that certainly wouldn't seem to have involved isolated incidents, this one in particular:

His name - Anthony Cipriano, Jr. Records show Cipriano is a heavy equipment operator for the sewer department, and a shop steward for the local 1033 laborer's union. We also caught him misusing a city truck.

Target 12 cameras capture Cipriano miles away from work, running errands in city trucks for hours; all against city policy.

We catch him: twice taking the city truck into Cranston to pick something up from his second job at a security firm; stopping at a Cranston bank;and several times driving to a North Providence hair salon and staying for more than an hour.

On this day, Cipriano arrives at work at 10:30 in the morning. Two hours later, he leaves and arrives at a Cranston dentist's office. More than an hour later, he departs.

Thinking he's heading back to work, we get in front of him. We're wrong.

"Oh burger king... Burger king."

Apparently, now it's lunch time.

On this five-hour work day, Cipriano spends nearly two hours on personal business.

According to the Transparency Train, sponsored by OSPRI (PDF), Cipriano's total compensation in 2007 was $77,299, including base pay of $46,006.88 and $8,084.93 (the rest being the cost of benefits). The other sewer employee caught in impropriety in the segment, foreman Anthony Greenwood received $85,199.14, with salary and overtime of $55,453.75 and $5,292.38.

Part 2 airs tonight, and the preview highlights supervisor Algot Abrahamson, whose remuneration was $82,715.38, with salary and overtime of $63,913.71 and $4,793.54.

The Lien Removal Timeline

Carroll Andrew Morse

The KPMG report on the Providence Tax Collector's office provides enough clues to tell us how the Cicilline administration will attempt to explain that no deliberate act of corruption occurred with regard to Felix Garcia's tax-lien(s).

The timeline of the liens is as follows:

  1. (January 2006) The initial city lien is placed...
    In June 2004, approximately eight months after Garcia Enterprises had ceased making payments on this account, Scott Hammer, on behalf of the City of Providence commenced legal action against Garcia Enterprises with the filing of a complaint in Rhode Island Superior Court on June 22, 2004. In June 2005, Hammer filed a motion for summary judgment against Garcia Enterprises Inc, for $90,937, the amount owed by the business in delinquent tangible tax. This amount cited by Hammer in his motion does not apparently reflect the payment of $25,000 made by Garcia Enterprises to the City in August 2004. Hammer recently stated that he was not aware that Garcia Enterprises had made such a payment to the City at that time, and surmised that the $25,000 payment may have been submitted to the Collector’s office in response to his filing of the lawsuit in June 2004.

    The motion for summary judgment was granted in August 2005, and the Court entered judgment for the full amount. In January 2006, Hammer levied a lien on behalf of the City against Garcia Enterprises’ property located at 559 Cranston Street Providence Rhode Island. This lien was recorded in the Providence Recorder of Deeds office on January 10, 2006.

  2. (May 2006) After a $75,000 check from John Cicilline is offered as "collateral" for the back taxes due, the lien is formally lifted...
    Scott Hammer filed a Discharge of Lien with the Providence Recorder of Deeds on May 9, 2006,32 at approximately 1:40PM, and the lien on 559 Cranston Street was subsequently lifted.

    Hammer advised during his interview with KPMG that it was not his practice to discharge a lien without receiving payment in full in a tax collection matter. He further stated, relative to other collection matters that he handled on the City’s behalf, that he could not recall a similar circumstance where he agreed to remove a lien without actual payment of funds.

  3. (November 2006) Somehow, it is learned that there are insufficient funds in John Cicilline's account to cover the $75,000 check. A new check is sought by the city, as is John Cicilline's signature on an agreement which includes reinstating the lien on the property in question...
    • As of November 1, 2006, Garcia Enterprises owed $106,540.22 in overdue tangible taxes to the City of Providence for the years 1998 – 2005.
    • John Cicilline’s Fleet account, his “Office Account,” from which both the initial check and the replacement check were written, “has never had sufficient funds available to cash Check.”
    • Upon execution of the agreement, a lien in the amount of $111,805.42 (including 2006 tax owed in addition to the 1998-2005 back taxes) would be placed on 559 Cranston Street, Providence, the property owned by Garcia Enterprises.
    • The replacement check provided by John Cicilline “is in full settlement of the lawsuit filed in this matter.”
    • The replacement check was to be held by Hammer’s law firm “for a period of no more than sixty (60) days and, thereafter, Check will be deposited into Blasbalg & Hammer’s Client Account without further reference,” and
    • Once the replacement check cleared the bank, Hammer’s law firm would issue a Satisfaction of Judgment relative to the previously filed lawsuit.
    In addition, accompanying the Agreement was a one page “Lien against Real Estate,” also to be signed by John Cicilline that indicated that the parties agreed that a lien would be placed on Garcia Enterprises’ property as described above.
  4. Eventually this agreement is signed by John Cicilline. However, it is never signed by Scott Hammer (the city's tax collection attorney), and the lien is never replaced...
    Once Ceprano received the original signed Agreement, however, he never forwarded it to Hammer for his execution. KPMG initially obtained a copy of the Agreement from the City Collector’s Garcia Enterprises file, and it was noted upon review that this copy only contained John Cicilline’s signature, and had not been countersigned by Hammer, as attorney representing the City. Prior to speaking with Scott Hammer about this, KPMG interviewed Bob Ceprano, who stated that he had advised Hammer that Cicilline signed the Agreement, but could not fully explain why he had not forwarded the Agreement to Hammer. Ceprano stated that Hammer advised him at the time he was frustrated, and did not want to spend more time on the Garcia Enterprises account without getting paid (under Hammer’s contract with the City, he was paid a commission only on funds actually collected). Ceprano also indicated that Hammer had expressed doubt about the effectiveness of replacing the lien on the property, in that re-filing the lien would not get the City back to its original position due to other liens that had been placed...

    Directly contradicting Ceprano’s version of events relative to the Agreement, Hammer subsequently advised KPMG that he had not at the time been informed by Ceprano or anyone else that John Cicilline had signed the Agreement. Hammer stated he only learned of this in early October 2008, when the Rhode Island State Police had shown him the original copy of the Agreement containing Cicilline’s signature. Hammer stated to KPMG that had he been aware of the signed Agreement at the time, he would have similarly signed it, and would have attempted to proceed under the terms of the Agreement, subject to his client’s (the City’s) direction.

Now, combine this version of events with this one other statement from the KPMG report (referring to the original check)...
Ceprano explained in his interview that neither he, nor the Collector’s Office was responsible for placing or removing liens, and that this was the responsibility of the City’s Collection Attorney, Scott Hammer.
...and it becomes clear, I believe, what the Cicilline administration's explanation for all this is going to be. Whatever was going on with people scrambling behind the scenes, the act that appears to be the most serious act of corruption -- the non-replacement of the lien on the Garcia property after the first check was determined to be no good -- was really the result of a breakdown in communication between Robert Ceprano and Scott Hammer.

This charge as well as John Cicilline's charge that the idea of using a check as "collateral" for a tax-lien was Robert Ceprano's in the first place are the charges that Mr. Ceprano has to be prepared to defend himself against.

A Bleg for a Blog

Justin Katz

Long-time participants in the blogosphere — a group in which I'd include lurking readers — will be familiar with the term "blegging." It was coined, I believe, by Jonah Goldberg, of National Review, who used it to indicate a blog post begging for information from readers. Our current bleg is for financial support, as Monique explained to Matt Allen, last night, on the Matt Allen show. Stream by clicking here, or download it.

Monique and Matt are absolutely correct that, to the extent that we're able to raise money from readers, we won't have the appearance of being beholden to any particular interests. I'd stress, though, that our ideological drive and (at least my) stubbornness are strong protection against corruption-by-financing. This is currently volunteer work for all of us, and our sense of the project has been formed in that crucible, regardless of our ability to become, as Monique put it, "semi-pro."

January 28, 2009

Re: "40 Year Wish List"

Monique Chartier

Another excerpt from that excellent WSJ article cited by Marc:

... by our estimate only $90 billion out of $825 billion, or about 12 cents of every $1, is for something that can plausibly be considered a growth stimulus. And even many of these projects aren't likely to help the economy immediately.

One of the many sound reasons against any government bailout ... sorry, stimulus package - can someone please advise the difference between a gov't bailout and gov't stimulus? - is the Congressional variation of Newton's First Law of Motion ("A body in motion will stay in motion ..."): A legislative body in spending mode will stay in spending mode. Gee, we're already spending on this, why don't we spend on that? Limiting this bill to expenditures of genuine economic stimulus proved too predictably impossible for the House.

Digging a little deeper, the reason for Newton's First Law of Congressional Spending is the necessity to purchase the voting cooperation of several hundred people. These people, while they definitely back everything the President wants to do and may or may not actually believe in the efficacy of this stimulus package (but what the heck, let's give it a shot), above all, want to go back to their home district waving a fist full of federal goodies. And in this case, passage of $98 billion of economic stimulus required a staggering $720 billion of pointless spending federal goodies to purchase a sufficient number of yea votes.

If members of Congress cannot see the intrinsic value of such legislation without expensive political inducement, it is far safer, far better not to start the spending in motion to begin with.

Campaigning in a Fluid Environment

Justin Katz

In addition to mentioning Anchor Rising's breaking of the news of Joe Trillo's gubernatorial candidacy, Cynthia Needham offers some details and an example of healthy longer-term perspective:

Trillo has $60,000 in his campaign coffers — that's more than most legislators, but thousands less than his potential Democrat opponents including General Treasurer Frank T. Caprio, Attorney General Patrick C. Lynch and Providence Mayor David N. Cicilline.

Can a Republican win in 2010? Trillo says the GOP will have less to worry about by the mid-term elections when, he predicts, the country's political mood will probably have shifted toward the center.

"Right now, it's an uphill climb," he said, referring to the popularity of Democrats in Rhode Island and beyond. "But two years from now, I think we will stand an excellent chance."

I would encourage other Republicans and conservative independents — whether candidates or voters — to keep that probability in mind. The year 2010 will arrive after two more years of Democrat General Assembly mismanagement and continued economic stagnation, if not continued decline, in Rhode Island.

"40 Year Wish List"

Marc Comtois


"Never let a serious crisis go to waste. What I mean by that is it's an opportunity to do things you couldn't do before."

So said White House Chief of Staff Rahm Emanuel in November, and Democrats in Congress are certainly taking his advice to heart. The 647-page, $825 billion House legislation is being sold as an economic "stimulus," but now that Democrats have finally released the details we understand Rahm's point much better. This is a political wonder that manages to spend money on just about every pent-up Democratic proposal of the last 40 years.

We've looked it over, and even we can't quite believe it. There's $1 billion for Amtrak, the federal railroad that hasn't turned a profit in 40 years; $2 billion for child-care subsidies; $50 million for that great engine of job creation, the National Endowment for the Arts; $400 million for global-warming research and another $2.4 billion for carbon-capture demonstration projects. There's even $650 million on top of the billions already doled out to pay for digital TV conversion coupons....

This is supposed to be a new era of bipartisanship, but this bill was written based on the wish list of every living -- or dead -- Democratic interest group. As Speaker Nancy Pelosi put it, "We won the election. We wrote the bill." So they did. Republicans should let them take all of the credit.

Why Robert Ceprano Is Getting the Blame

Carroll Andrew Morse

Here are the two-and-a-half versions from the KPMG report (courtesy of the Projo) of where the idea of John Cicilline writing a $75,000 check (that he couldn't cover) to help reconcile Felix Garcia's tax debt came from.

According to the version of events presented as Providence Tax Collector Robert Ceprano's, John Cicilline more-or-less out of nowhere offers the $75,000 check as "collateral" for the taxes owed...

Ceprano related to KPMG that, on or about May 9, 2006, in a meeting with John Cicilline, Cicilline presented a check from his law office account made to the City of Providence in the amount of $75,000. The check was presented by John Cicilline in relation to the settlement agreement reached by him on behalf of his client Garcia, regarding the past due tangible taxes owed to the City of Providence by Garcia Enterprises. The check was dated May 9, 2006, and contained a notation in the memo line “Settlement 1998 - 2005 #99155320” (99155320 is Garcia Enterprises’ tangible tax account number).

Ceprano recalled that during the above referenced meeting with John Cicilline to discuss the Garcia Enterprises account, Cicilline offered to provide this check in return for the City’s agreement to lift the lien on Garcia Enterprises’ property at 559 Cranston Street. Ceprano advised that the understanding with John Cicilline was that the City would remove the lien and hold Cicilline’s check as “collateral,” until Garcia was able to complete a re-financing of this property, and pay the $75,000 to the City from the proceeds.

However, a little further in, the report suggests that tax collection attorney Scott Hammer may have been the one who came up with the idea of a lawyer writing a check for his client...
In our interview, Hammer’s recollection of the discussion regarding the check varied, although he ultimately confirmed that he did advise Ceprano he approved of the arrangement. He initially recalled that he thought it crazy for John Cicilline to offer to put up personal funds for his client, and that he advised Ceprano that accepting the check was not the best idea. On further reflection, in his discussion with KPMG, he indicated that he may have actually suggested that John Cicilline provide a check on Garcia’s behalf, as a way for Hammer and the City to become more comfortable with Cicilline’s request to have the lien removed. Hammer explained that he suggested this in order to protect his client and to have a guarantee of payment. While he acknowledged that John Cicilline’s check was not actually a guaranteed payment, he indicated that he was comfortable with the situation because the check was from an attorney, and the fact that the attorney was well known and was the Mayor’s brother.
Then even further in, according to a detailed version of John Cicilline's recollection of events, Cicilline claims that the idea of using an uncashed check as collateral came to him as a suggestion from Ceprano...
Mr. Ceprano told Mr. Cicilline that if the City were provided a check for $75,000 as surety for the payment of taxes, Mr. Ceprano could see his way clear to releasing the lien for the purpose of allowing the refinance. Mr. Cicilline said he would talk to his client about getting a check to post to the City to be cashed after the refinance.

At that point in time, Mr. Ceprano stated that he did not want a check from Mr. Garcia. He said he would take a check from John Cicilline and hold it and not cash it. Mr. Cicilline was shocked. Mr. Cicilline inquired as to why he would give a check, drafted on his account, for taxes owed by his client. Mr. Ceprano stated that he (Mr. Ceprano) would feel more confident that the bill would get paid if John gave the City a check for $75,000 to hold. John responded by laughing and saying:

“I’ll do it but I don’t have that kind of money in my account.”

Ceprano said that was okay because he would just be holding the check until Garcia refinanced and paid the City. Again John laughed and said:

“That’s fine, but don’t try to cash my check if I write it for $75,000 because I’m broke. You would be lucky if I had $2,000 to $3,000 to my name.”

John went on to express that his account had never had that kind of money in it. Mr. Ceprano responded by saying that was fine; the City would not cash the check; it would simply buy some time for John’s client to refinance.

Can we presume that the firing of Robert Ceprano implies the city is accepting John Cicilline's version of events as what actually happened?

Ears on the Ground and Flies on the Wall

Justin Katz

I've a direct interest in the proceedings, of course, but part of what I've been doing at all of these public meetings in Tiverton has been developing and practicing a citizen-driven mode of coverage. The mainstream media doesn't cover everything, and of what it does, it offers only that for which it has space and believes there to be a large audience. But having public eyes and ears present when power is being applied is a necessity.

I honestly don't know the degree to which my increasing ability and habit of recording and posting audio from various meetings is to credit for the good behavior of the Tiverton teachers' union, last night, but I think it likely to have been a factor. Hearing the union leader in East Providence stammer after Jim Hummel played one of my recordings for her live on the radio had to have made an impression.

In that regard, citizen recordings can have two related benefits:

  • They enable other busy citizens to hear important moments at meetings, without having to attend every one.
  • To the extent that they give the unions a reason to behave, they'll make it more likely that more citizens than just those representing taxpayer groups will stand up and speak.

Inasmuch as we are able, Anchor Rising will be working to expand not only our own, but also others' coverage of events in other towns. The more broadly we can apply the technique, the more likely a reformist movement will congeal, and the better it will be able identify and target common themes and problems.

Once again, the limiting factors are the nearly synonymous time and money, so if you're able, please help us to bring Anchor Rising to another level of utility.

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Discouraging Behavior

Justin Katz

This quotation from the Providence Journal's latest story on Gov. Carcieri's tax panel pretty well highlights the philosophical differences at play:

... under proposals involving the personal income tax, lower-income and many higher-income taxpayers would generally pay less, but middle-income taxpayers — and the state’s highest-income taxpayers — would generally pay more.

This is partly because the proposals would eliminate most tax credits; end the favorable tax treatment of profit on the sale of stock and other such assets; and prohibit a taxpayer from deducting, for state tax purposes, such items as charitable contributions, mortgage interest and local property taxes.

So the disfavored demographic in this proposed tax rearrangement would be charitably inclined homeowners investing in the state. Somehow I have a difficult time believing that this particular panel is trying to edge the state even closer to socialism, but at some point effect must subsume intention.

Snow Storm Tools - Especially For Those at Work and on an I-Palm-Thingy

Monique Chartier

Radar loop.

Traffic cams.

Listen, call, compare notes: WPRO News Talk 630/99.7 FM. ~ AM 920 WHJJ.


And over at Not for Nothing, Ian Donnis came to the conclusion while driving to work today that we are a state of wimps. (Possibly I exaggerate slightly.) He also points out that in the spirit of the storm, a restaurant is giving out free bread and milk. Lactose intolerant customers are welcome to substitute vino for the latter.

Listening in on the School Committee

Justin Katz

Here's some significant audio from last night's school committee meeting in Tiverton, as I described on scene. A key take-away from the evening is that almost half of the $300,000+ that the school district must cut from the 2009-2010 budget to stay within the state spending cap is a direct result of this contract's approval. Unless the committee plans to cut teacher pay next year, that means either layoffs or decreases in other budget items, which already constitute a lower percentage of per-student spending than is true for the state as a whole.

January 27, 2009

Back to School

Justin Katz

The new teachers' contract is up for approval again in Tiverton, and inasmuch as the agenda item is "approval of arbitrator's interim award (NEA contract)," it looks likely to go the other way. Apparently the latest info is that the state is only reducing their funding by 5%, so they're confident giving away over $300,000.

The crowd is certainly not of East Providence proportions, but some of the same principals are here (e.g., Pat Crowley), and the local union leaders are way too happy, and much too chummy with Superintendent Bill Rearick, for the outcome to be good.

ADDENDUM 7:01 p.m.:

As we wait for the school committee to have their beginning-of-meeting executive session (probably deciding how to vote after the formality of public comment), I thought I'd note that I've prepared some remarks to read when the time comes. I sincerely hope that I've done enough work with the recorder, already, to have persuaded the union to let people speak without attack.

We'll see.

ADDENDUM 7:08 p.m.:

While I wait, some more broad musing: I'm really not afraid of public speaking... I've made too much of a fool of myself in too many situations to be timid, but it's really an intimidating prospect to speak at school committee meetings. I really wish Tiverton would do as East Providence does and put the audience microphone off to one side, rather than in the very middle, of the space below the stage so that speakers don't feel as if they're in some interrogation setting with the angry audience bearing down from behind.

ADDENDUM 7:40 p.m.:

We're back in session and hearing a review of the status of the new school construction. The contract discussion is next.

The school committee looked somewhat glum when it entered, but it's impossible to tell from that which way things might go.

ADDENDUM 7:49 p.m.:

Here goes. Carol Herrmann voted to approve, and Sally Black seconded.

Supt. Rearick is about to speak and suggested that committee members speak before public comment.

ADDENDUM 7:52 p.m.:

Rearick just stated that this money is budgeted and will not affect the tax rate... as if every year is distinct.

He's also arguing that negotiations are holding up needed reform and accreditation changes.

ADDENDUM 7:54 p.m.:

Carol Herrmann is for the contract. Again, she brought up the held-up reforms.


Danielle Coulter is arguing that economic times have changed and that, since we're laying off teachers, it's ridiculous to give their coworkers raises.

ADDENDUM 7:58 p.m.:

Growing titters in the crowd as Danielle speaks. They're clearly trying to keep it down, but the habit must be strong.

ADDENDUM 8:00 p.m.

Leonard Wright is "on the fence," but willing to listen, and leaning toward approving the contract for "high quality teachers."

Sally Black is arguing that "during this time" --- when people are suffering --- education is something that we need to hold on to.

ADDENDUM 8:03 p.m.:

Jan Burgandy (committee president) is also "on the fence." "This is the most difficult vote I will probably ever have to take."

"We have to hope that in the future this process will be more civil and converge must faster."

As I'm about to argue: it won't.

ADDENDUM 8:06 p.m.:

I cannot believe that it doesn't strike the school committee as plain wrong that an employment contract should potentially hold up the educational need of students (e.g., accreditation).

ADDENDUM 8:08 p.m.:

Bergandy just held up a giant gavel. The audience is laughing. Glad it's so clubby.

ADDENDUM 8:09 p.m.:

David Nelson (TCC president) is speaking. I hear shushing behind.

ADDENDUM 8:12 p.m.

TCC member Joe Souza is talking about state-wide budget history.

He just mentioned that, in his construction job, he had to lay off 16 guys, this year.

ADDENDUM 8:16 p.m.:

A citizen I don't know is saying that teachers should sacrifice. "We're not asking you to move into a tent city. You're all doing pretty well."

ADDENDUM 8:24 p.m.:

I was working through my three-minute statement and — amazingly — Jan Bergandy stopped me to state that we're not getting into monetary or performance analysis.

Guess I really am disliked around town.

ADDENDUM 8:27 p.m.:

Ms. Black stopped me as I walked away to say that she voted against unreasonable contracts, so it is clearly not her intention to give teachers everything they want. I'm open to correction on this, but my understanding is that the committee decided the maximum amount that they could give to the teachers and told the teachers that was it. In other words, Ms. Black voted not to give over an impossible amount, but did intend to give over what she understood to be the maximum amount possible.

That was the attitude against which I was speaking.

ADDENDUM 8:32 p.m.:

TCC member Rob Coulter suggested that the school committee should consider this action (approving the contract) to negate any further request for money from the taxpayers.

ADDENDUM 8:35 p.m.:

Jan Bergandy just stated that the school committee held off on signing the contract longer than anybody else in local government.

Mike Burk just mocked me — I brought up onto the stage a chart for the school committee to consider — by throwing up a bag of candy. ("Red herring.") It struck me that several of them were not actually arguments that had been made, which would make the statement about red herrings a red herring itself.

ADDENDUM 8:43 p.m.:

Burk just said that the committee should really "hold the line" with the next contract. Well, there's the excuse for the union to spin the wheels until the economy is better suited to their contractual desires.

ADDENDUM 8:46 p.m.:

Chris Cotta (formerly a local elected official) just suggested that the school committee shouldn't listen to us taxpayers because "they'll always come forward to complain." Guess that's as good a reason to ignore us as any.

ADDENDUM 8:49 p.m.:

I've wondered why local officials take themselves so seriously. That's not to say that their job is not important, but the heat of the politics strikes me as excessive. Some of the speeches tonight from (former) elected officials confirm my growing conclusion that it's really an ego thing.

Not to say that's not understandable. But it's interesting.

ADDENDUM 8:53 p.m.:

The contract passes. All for, except Danielle Coulter's no and Leonard Wright's abstention.

ADDENDUM 8:59 p.m.:

Five minute recess.

You know, this went the way I expected, so I guess it was good to state some principles and considerations for future use. Watching the whole interplay of local politics can be dispiriting, I must say, and I'd suggest that, for that very reason, more regular folks should get involved. Society at large doesn't operate this way, and neither should our government.

It certainly isn't pleasant to be the bad guy, though — especially when it's on top of financial struggles and a frequently tough day job.

ADDENDUM 9:12 p.m.:

Rearick is talking about the next budget and the various reductions in staff. Almost all of the teachers who were here have left.

Guess it's easier to leave on a high note.

ADDENDUM 9:18 p.m.:

My mind drifted a bit, but I think I just heard Supt. Rearick say that he's considering cutting a high-school technology teacher position. That doesn't sound good.

ADDENDUM 9:21 p.m.:

I do have a positive note, by the way: The union members were very well behaved tonight. I'm sure much of that had to do with their apparently sure knowledge from the beginning that they were going to get their big checks, but I do hope that it helps that they know they're being recorded.

That's something that other reform-type folks around the state should consider. I'd be willing to help.

ADDENDUM 9:33 p.m.:

Town Council Member Jay Lambert is objecting to the school committee's apparent complacency with the notion of increasing taxes — during a recession, with the state losing population at nation-leading rates — at the maximum amount.

"This committee is a real disappointment."

"That cap was not put in place to be a goal to shoot for every single year, especially during these economic times."

ADDENDUM 9:43 p.m.:

Rob Coulter just clarified with the school committee that the 09-10 budget — on which the committee voted at the previous meeting — did reflect the passage of the contract this evening. The district's financial guy stated that it's reflected in the 08-09 budget, but it seems to me that the numbers would have carried through to the next year.

ADDENDUM 10:18 p.m.:

Local union head Amy Mullen just asked to clarify Mr. Wright's vote on the contract. He said that he abstained and subsequently voted to approve. ("The minutes will reflect the vote as four for.")

I've been here the whole time, but I must have missed his switched vote.

Well, well.

ADDENDUM (from home):

After the meeting, I confirmed with district financial director Doug Fiore that the budget that the school committee submitted to the budget committee did include the contract that was approved tonight. What that means is that the number for '08-'09 would have been $301,264 lower had the contract been voted down. It also means that the number for '09-'10 would have been roughly $150,000 lower, as well — almost one-half of the current budget gap.

Supt. Rearick has already brought the $323,376 down to around $209,000 (mainly through staff reductions), so absent the approval of the new contract, the school district would only need to come up with roughly $59,000 more in reductions. Five figures instead of six.

Caught in the Scientist's Perspective

Justin Katz

Stanley Aronson writes reasonable, interesting columns for the Providence Journal, but I often get the impression of an underlying scientism. By that relatively new coinage, I mean the tendency — a system of belief, really — to treat scientific answers as complete grounds for defining one's life.

So, in context of an essay about doctors' evolving ability to diagnose, even to forecast, illness, Aronson writes:

Where there had been three populations in a tripartite world dominated by health, disease or disease-incipiency, there was now a fourth population, namely, those currently quite healthy and without any underlying latent disease but who are nonetheless destined by the nature of their genetic baggage to be at high risk for some awesome disease in the future.

There are many who will bemoan: Has the time arrived when my physical destiny is inflexibly determined without my active participation? Have the domains of determinism and predestination, the specters that haunted theologians for centuries, finally emerged as an incontrovertible secular reality? Have I no choice in life but to be a pawn manipulated by my genes?

Personally, I don't believe that anything essential has changed in this regard. Human beings have always know that they would die. Using genetic information to give some sense of the when hardly represents an existential shift.

By standing in awe of science, however, those who tend toward Aronson's view lose sight of a critical principle underlying religion's answer to the question of destiny: Your lifespan and your health are not synonymous with your destiny. We are "manipulated by our genes" only if we waste our lives tracing their fatal calendar.

Yes, it is "an incontrovertible secular reality" that we will all die. What we do before (and after) that event is what defines us, and our destinies.

Strangeness as an Advantage

Justin Katz

I mean, really, who wants to spend their free time sifting through numbers and tapping away at data entry? Well... we do! It's like a terrible itch when a question of truth arises and an argument clashes with one's understanding. Sometimes only a spreadsheet will do.

While most folks would see such laborious tasks as a means toward the end of income, it is our peculiar desire to raise money so that we can do more research and analysis. Already we've used some of our trickle of funds to gain access to such information as the IRS taxpayer migration tables. If we were able to finance some time, we'd be able to expand our investment in data that others have collected, as well as develop our own.

(And there's the dark secret of our motivation: When one's objective is truth, information is power.)

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Sittin' on the Port in the Bay

Justin Katz

As regular readers know, I'm not a supporter of specifically targeted economic development. For one thing, I lack confidence in our leaders' ability to define such far-reaching strategic plans. Moreover, as we see with on the casino issue, if businesses think a particular government activity or change will be profitable, they'll lobby for it, making noise about its value. When the government opts to act independently of private-sector enthusiasm, it does so with ulterior motives, plodding ahead with something other than economic development as its core motivation.

That is the sense that I get about the Quonset port debate. In the years that I've watched it rage out of the corner of my eye, I don't believe I've ever heard from a major shipper, or some other likely client, that the port would be a boon for them, and now it appears that area is seeing other kinds of businesses move in:

On a tour of the park last week, Steven J. King, managing director of the Quonset Development Corporation, could point to only a handful of lots in the former Navy base that haven't been leased or slated for redevelopment. Only about 200 acres in the 3,160-acre Quonset Business Park are still available.

Much of the development has taken place in the past several years. In 2003, there were 136 businesses in the park. Now, the site is home to 164 businesses that employ more than 8,800 people. The number of jobs has increased by a third over the past four years.

The positive to that expansion (which some may see as a negative) is that the government investment is minimal. Private funds (perhaps with some public assistance) goes toward the buildings, paving, and landscaping necessary, and that's that. By contrast:

... some legislators seem to believe those projects aren't enough and have started talking again about the container-port proposal that was championed by Lincoln C. Almond, Carcieri's predecessor in the governor's office. That plan would have required extensive dredging in Narragansett Bay and the filling of hundreds of acres there. Its price tag was estimated at $3 billion.

You can be assured that some powerful people are looking at that potential $3 billion expense as a payday, rather than an investment in longer-term revenue. Indeed, as far as I've read, there is no indication that the investment would be utilized. The Almond plan was a matter of debate before my time of local awareness, but there does not appear to be a corporate name behind the initiative, and the fact that some resource is "underutilized" does not mean that a specific improvement project is the answer.

January 26, 2009

A Late Meeting Early

Justin Katz

So how is it that I can walk in, at 7:02 p.m., to a public meeting that's advertised (PDF) for a 7:00 start, and the town council is already through the first page of its agenda? It's typical — the meetings really start at 6:30 p.m. [see footnote] — but this evening, I walked into a mildly contentious-seeming discussion between the police chief and councillor Louise Durfee, and it does make me wonder at the appropriateness of such business being conducted before an uninitiated citizen would have arrived.

ADDENDUM 7:21 p.m.:

Council President Don Bollin is absent tonight because of a very unfortunate and close death in the family. My prayers and condolences go out to all those close to the deceased.

ADDENDUM 7:31 p.m.:

A local lawyer seeking a position on the new Juvenile Hearing Board just noted that the children who go awry aren't all from "low income families in North Tiverton" (my neighborhood), but also from "good taxpaying families on the south side of town."

For the record, that I pay way too much to the town to let that comment go without response.

ADDENDUM 7:39 p.m.:

Man of local fame, Michael Burk, just failed in a bid for a position on the Tiverton Housing Authority. Louise Durfee and Joanne Arruda voted for him, but the other four councillors (led by two TCC-endorsed candidates) voted for Elaine Nearpass.

ADDENDUM 7:47 p.m.:

Councillor Jay Lambert just withdrew his suggestion that the council cut their own pay, leaving it as a personal decision for each. Councillors Durfee and Arruda complimented his willingness to take opposing arguments under advisement.

ADDENDUM 8:03 p.m.:

An auditor brought in by the town treasurer is giving a presentation with an overheaed projector and transparencies. Now there's a frugal guy!

By the way, Treasurer DiMattia mentioned that the town currently has reserves in the amount of 1.3% of expenditures, while the town charter requires one of 3%. Nobody gasped, so it doesn't appear that anything will be done with urgency.

ADDENDUM 8:09 p.m.:

The auditor just suggested that the 3% in the charter should actually be 8-10% for bonding reasons.

ADDENDUM 8:27 p.m.:

The auditor just said that Tiverton's net pension obligation is one of the lowest in the state (covering only police officers, with everybody else in the state plan).

ADDENDUM 8:40 p.m.:

The auditor's done, and further along in the agenda: Louise Durfee is suggesting that the council go through its budget line by line before approving it and sending it to the Budget Committee, so the council doesn't get "beat up over it."

ADDENDUM 8:42 p.m.:

Maybe one has to be a lawyer, but I'm not sure how it's possible for the council to vote down a motion to send the budget to the Budget Committee on the grounds that the committee already has a budget with which to work. Semantic debate about whether the Budget Committee currently holds a budget or a proposal or a vague suggestion.

ADDENDUM 8:49 p.m.

A couple of local advocates for animal care are presenting a preemptive request to maintain funds and efforts in light of budget problems. They have offered, to help with funds via a group called Placing Paws.

ADDENDUM 8:56 p.m.:

This is interesting: If feral cats aren't controlled, they will multiply to the point at which they'll start to support larger predators, like coyotes.

My summation might have been wrongly emphasized. In summary, the advocates are suggesting that they're looking for ways to maximize dollars and contribute money to defray the costs and keep the services going.

ADDENDUM 9:18 p.m.:

Councillor Hannibal Costa just suggested that towns sell bonds to buy pieces of Twin River, with the state. No action taken.

ADDENDUM 9:23 p.m.:

The town administrator just announced — as one early means of saving money — that the town will no longer pick up white goods (appliances, etc.) for delivery to the town dump.

Councillor Ed Roderick just asked whether the town can charge for such pickup, and the administrator said that's on the table.

It's only a sense, but I take that as a small shot across the bow of budget cutters.

* I honestly did not know how significantly this comment would be treated. Had I realized that the excessively short-hand version of my thought would be taken so seriously — and literally — I would have taken a moment to flesh it out. The fact is that, during my previous bout of regular town council meeting attendance, I changed the time on my calendar to 6:30, because it seemed that arriving at 7 always led me to miss the beginnings of the meetings. That was the heart of my reference, not any knowledge that town council meetings habitually begin early according to some unwritten schedule. As I formed that concept into words while initially writing this post, it started to get away from me, so I cut it far too short so as not to interfere with my following of the meeting.

I maintain that it has always seemed to me that the council starts early, and given the sparse attendance (except for those scheduled for business), it didn't occur to me that it might be a point of controversy: So it starts early (my thinking went); regular attendees learn to arrive with time to spare, and those with business before the council will do the same, or the council will give them time to arrive.

As for this specific meeting, I can only attest to my observation and conclusion that the meeting began early.

Spot the Missing Factor

Justin Katz

No doubt thinking of that right-wing conspiracy to fool Rhode Islanders into believing that our state is facing a dire economic situation requiring drastic change in policies, Russ Conway asks why nobody's talking about this (emphasis added):

While Massachusetts' share of the venture capital economy dwarfs that of other New England states, Rhode Island and New Hampshire managed to post significant gains in 2008. Rhode Island's venture capital funding grew by a factor of more than ten, from $4.2 million in 2007 to $51.8 million this past year, while New Hampshire investing grew to $158.8 million, an increase of 19.4 percent. Connecticut's VC investment fell precipitously, dropping 60.1 percent to $142.9 million. Vermont posted $14.7 million, a 33.7 percent drop; while Maine saw investing fall off by 74.1 percent, to $2 million.

In the comments, Bobby O suggests that it has something to do with our ties to the U.S. Navy, and I can't say but that the military plays the key role, here. What's interesting, though, is what's not mentioned in the discussion. Not once.

Here's a hint: It's something against which RI Futurites prefer to rail.

Comparative NECAPs

Justin Katz

As you've probably heard, the results for the 2008 New England Common Assessment Program (NECAP) tests are available, and Rhode Island overall did see improvements. For purposes of comparison, I've averaged the proficiency scores for each of the three tests and ranked the schools:

RI Grades 3-8 NECAP Score Ranking, 2008
Average Proficiency
Increase from
2008 Rank 2007 Rank
Barrington 88 3 1 1
East Greenwich 81.33 6.67 2 6
Jamestown 79.33 11.33 3 12
Foster 78.67 -0.67 4 2
Smithfield 78.33 4 5 7
South Kingstown 77.33 -0.67 6 4
New Shoreham 77 -2 7 3
Narragansett 75.33 7 8 11
Portsmouth 74.67 10 9 20
Little Compton 74.33 -2 10 5
Scituate 73.67 -0.33 11 8
Lincoln 72.67 7 12 18
North Kingstown 72.33 2 13 10
Chariho 71.67 4.33 14 14
Bristol Warren 71.33 3.67 15 13
The Compass School 71 -2 16 9
Westerly 71 4 17 15
Tiverton 71 14 18 29
Exeter-West Greenwich 70.67 8.33 19 22
Coventry 70 3.67 20 16
Glocester 69.67 6.67 21 21
Middletown 68.67 2.33 22 17
Kingston Hill 66 0.67 23 19
Warwick 66 4.33 24 23
Cranston 65.67 5.67 25 24
Cumberland 62.67 4.33 26 27
North Smithfield 60.33 1.33 27 26
Johnston 60 3.33 28 30
North Providence 59.67 7 29 32
Paul Cuffee Charter 57.33 18.33 30 36
Foster-Glocester 57 -3 31 25
East Providence 57 4 32 31
Burrillville 55.67 -1.67 33 28
West Warwick 55 2.33 34 33
Newport 52.33 11 35 35
The Learning Community Charter 47 9.33 37 37
International Charter 47 11.67 36 39
Pawtucket 46 2 38 34
Woonsocket 43.33 6.33 39 38
CVS Highlander Charter 40.67 6 40 40
Providence 37.33 5.67 41 42
Central Fals 34.33 0.33 42 41
Urban Collaborative 30 8 43 44

RI Grade 11 NECAP Score Ranking, 2008
Average Proficiency
Increase from
2008 Rank 2007 Rank
Barrington 80.33 9.33 1 1
East Greenwich 77 7.33 2 2
South Kingstown 66.33 7.33 3 4
Narragansett 63 12.33 4 9
Portsmouth 63 4.67 5 5
Lincoln 59.33 6.33 6 8
Scituate 59 12.67 7 16
Bristol Warren 58.67 4.33 8 7
Foster-Glocester 57 14.33 9 19
Middletown 57 1.67 10 6
North Smithfield 55 7 11 14
Westerly 54.33 4 12 10
Smithfield 53.33 3.33 13 12
Exeter-West Greenwich 53 5 14 15
North Kingstown 52.67 -8.33 15 3
Tiverton 52.33 2 16 11
Chariho 52 3 17 13
Cumberland 51.33 14.33 18 24
Burrillville 48.33 11 19 23
Coventry 48 5 20 18
Newport 44.33 5.33 21 22
Warwick 43.67 4.33 22 21
North Providence 43 0.33 23 20
Cranston 42.67 9 24 26
Wm. Davies Jr. 42.33 18.33 25 33
West Warwick 41.67 6 26 25
Johnston 41.33 -3.33 27 17
BEACON Charter 40 6.33 28 27
East Providence 35.67 5 29 28
Blackstone Academy 34.67 8.33 30 32
Pawtucket 33.67 5 31 29
Providence 32.67 5.33 32 30
Woonsocket 32 4.67 33 31
Metropolitan Regional 28.33 7.67 34 34
Central Falls 25.67 7.33 35 35

Beginning the Ramparts

Justin Katz

Let's leave this on an emotional level for a moment: What's your feeling about these times through which we're living? For me, the impression is of watching my fellow Rhode Islanders and fellow Americans building bulwarks against the invasion of an unknown future and being brushed aside each time I shout that they're making the whole thing wrong. A few years ago, we needed mostly to clear out some old rubble before building, but now, now we're going to have to dismantle a misguided structure — held together with the latest in stubborn fasteners and impossibly strong adhesives. Each new post raised and set in concrete will ultimately have to be pried from the ground. And the enemy is bearing down on us all.

That's a dark and cryptic metaphor, to be sure, but at all layers of government, it seems, the solutions that are en vogue resemble the problems that they purport to solve. Misanalysis is the order of the day, and self-serving blindness its foundation. What's needed is to increase the volume at which we who see can be heard, and to increase the number of our voices.

Our reaction to the last election, at the state and national levels, has served as motivation for us, at Anchor Rising, to ratchet up our output, increase our participation, and brainstorm new activities for the new year — leading up to the next election. Judging from the healthy rebound that we've seen in readership after the holiday lull, as well as feedback that we receive from around the state, you've been noticing our efforts.

We want to keep the momentum going. We want to assist in the construction of the right sort of ramparts.

There's only so much that hobbyists can do, of course, which is why we'd like to begin the transition to something more. The two ingredients for that project are time and money — the former of which may easily be expressed in terms of the latter. If we don't feel compelled to work extra hours on nights and weekends for financial reasons, we'll have more time to take up the goals of Anchor Rising. If we have the means to absorb hours of missed work, we'll be able to expand our participation in the civil debate. If we have the technology to maximize our investigational and literary productivity, we'll be able to cover more ground.

For some perspective, if three-quarters or so of the unique visitors to the site each day thought our daily offerings worth $0.25, or $7.60 per month, we could fund a full-time position based on that revenue alone. If you'd count yourself among that crowd, the "subscribe" button below and on the left-hand side of the page will enable automatic, regular payments.

We'll never achieve such a high percentage, of course, because some portion of our daily visitors are computers, not people, others come here randomly each day, and still others are folks who'd just as soon see us disappear from the Rhode Island scene. That being the case, any additional donations that you're willing and able to provide would go a long way.

Subscriptions and donations may be made using credit cards via PayPal (no PayPal account is necessary) by clicking the following:

Those who would prefer the more direct route of checks or money orders can make them out to Anchor Rising and send them to:

Anchor Rising
P.O. Box 751
Portsmouth, RI 02871

The interests against which we must struggle for the sake of our society are well organized and well funded. In response, our intention is not to redirect the funding of our allies our way, but to provide a common understanding of the landscape, to enable a forum through which to broaden our agreement and define our purpose, and to develop a communications network by which reformers can come together. We'll continue to work toward these ends regardless of our income, but our effectiveness will in part depend on its increasing.

Even as outgunned as we are, truth has proven to be a powerful weapon, but it is not enough if nobody hears it and if nobody acts on its basis. Please, help us to build the structure from which it can be delivered.

January 25, 2009

Freeze. Dirt. Bag.

Monique Chartier

From the BBC News.

Two Japanese companies have unveiled a security robot that can be commanded from a mobile phone to hurl a net that traps suspected intruders.

The prototype T-34 was developed jointly by robot firm Tmsuk Co and security firm Alacom Co.

It moves at up to 10km/h (6mph), and can be controlled by someone seeing real-time images on a mobile phone.

The small robot is built on wheels and is equipped with sensors that can detect the movements of intruders.

And watch it in action.

Up Being Down as a Political Philosophy

Justin Katz

The way in which individuals construct an understanding of their societies is what makes it fatal to paint them all with the bold colors of their affiliations: People will be particularly amenable to certain explanations for events around them — whether they've been pushed toward prescribed priorities via social clichés, have an economic interest in a particular construction, or some combination — and will act accordingly. Their culpability is not diminished by that fact, but it does have implications for any strategy intended to change their minds (or at least persuade them to loosen their grip on something precious that they're strangling).

I bring this up in an exercise to deepen my empathy for those whose behavior I so deplore and whose practices I find so detrimental to the state. Imagine yourself, for instance, in the place of somebody who's a few steps closer to the left of political center and/or whose very livelihood is dramatically reliant upon the strength of organized public-sector unions. From such a position, Pat Crowley's response to a description of the forces involved in East Providence by Travis Rowley might just succeed in its certain end of pushing you a little farther away from cold reality (emphasis added):

But, like I said before, there is a certain class of folks in Rhode island that are upset that their standing as overlords is being challenged. They're not upset about class warfare, they're upset that the under classes are starting to fight back in the war they have been waging against workers and poor people for generations. Rowley's pieces, now published more frequently in The Journal, expose the glass jaw of the right wing. The joining in common cause of disgraced Education Partnership refugees, so-called Taxpayer groups with out of state memberships (watch this video), and anti-immigrant bullies in common cause against teachers and unions is called Astroturfing. The reason why they are doing it: Rowley's first line: "UNIONS, the engine of the Rhode Island left..."

In this bizarre world, a young go-getting member of the state's almost non-existent opposition party is the emblem of a class of "overlords," struggling to maintain the oppression of a category of citizens whose average household income is actually well above the average for the state. Crowley even provides a link to a conspiratorial definition for "astroturfing":

The use of paid shills to create the impression of a popular movement, through means like letters to newspapers from soi-disant 'concerned citizens', paid opinion pieces, and the formation of grass-roots lobbying groups that are actually funded by a PR group (AstroTurf is fake grass; hence the term).

In your empathetic mode, doesn't it all begin to make sense? Put aside your first-hand knowledge that the local reform groups are really just citizens who've had enough and imagine that this small group of vocal people who wish to make changes to your enviable employment package are actually a front group for powerful interests attempting to keep the lid on society's populist potential. Only you, the middle-class union worker, remain as a shining emblem of The Possible for your fellow workers. (And besides, who wants to work into their 60s?)

Under those circumstances, you too might find yourself telling a financially struggling carpenter why you and your even-better-paid spouse (with the family business and a rental property) absolutely deserve an increase in remuneration even as the state's economy collapses. You might even be inclined to listen to the flashy union executive as he explains to you that screaming and intimidating elected municipal officials is all just part of the negotiation game — absolutely essential to the prevention of backsliding into indentured servitude.

If the so-called "taxpayers" aren't villains, then the whole worldview into which you've molded your career deserves some scrutiny. And if Crowley's audience begins to question whether there's actually a chance — a hint worth considering — that they've somehow become the bad guys in the story, his own lucrative position as an operative for an immensely powerful union organization (that actually does fund astroturfers) comes under threat.

Robert Reich - Some Follow Up Questions

Monique Chartier

Setting aside the fact that he apparently didn't get Martin Luther King Jr.'s memo, can former Labor Secretary Robert Reich please clarify several confusing aspects of his remarks a couple of weeks ago in front of the House Democratic Steering and Policy Committee? Outlining what he believes should be the focus of President Obama's economic stimulus, he said [h/t NewsBusters]

I am concerned, as I'm sure many of you are, that these jobs not simply go to high school people who are already professionals or to white male construction workers. I have nothing against white male construction workers. I'm just saying that there are a lot of other people who have needs as well.

And therefore, in my remarks, I have suggested to you, and I'm certainly happy to talk about it more, ways in which the money can be -- criteria can be set so that the money does go to others. The long- term unemployed, minorities, women, people who are not necessarily construction workers or high skilled professionals.

1.) "high school people who are already professionals"

Don't most professionals possess education beyond the high school level? So are you opposed to high school graduates receiving government stimulus money or professionals receiving it? [Edit: To quote Emily Litella, never mind. Andrew just pointed out that I mis-read "high skilled" as "high school".]

2.) "there are a lot of other people who have needs as well"

So among all the needy people in the country, you wish Congress to choose certain ones who will receive this government largesse. What do you propose as their criteria for making this selection? Will such criteria identify those who are neediest? Or is that not a requisite?

3.) "people who are not necessarily construction workers or high skilled professionals"

Isn't this stimulus money supposed to go to rebuild the national infrastructure? How would we accomplish that without employing construction workers, architects and engineers?

As to the theory that underlies his remarks:

And that vicious cycle is that because consumers don't have the money, then businesses are not going to produce. And if businesses don't produce, they're going to lay people off. And if they lay people off people have even less money.

In fact, Mr. Reich indicates that much of the stimulus package should be spent on expanded unemployment benefits, food stamps and aid to state governments. Is there any indication, any basis to assert that directing large amounts of money in these particular directions will pull our economy out of its slump?

Further, stipulating for a moment that simply getting money into certain people's hands as fast as possible however we do it is the right answer, whose money would we give them? Who would fund this massive distribution of government money?

Which Way to Stimulate

Justin Katz

Bruce Bartlett's summary of the past 80 years of stimulus debate is well worth a few minutes of your time. He concludes thus:

The problem is that fiscal stimulus needs to be injected right now to counter the liquidity trap. If that were the case, I think we might well get a very high multiplier effect this year. But if much of the stimulus doesn't come online until next year, when we are likely to be past the worst of the slowdown, then crowding out will greatly diminish the effectiveness of the stimulus, just as the critics argue. According to the Congressional Budget Office, only a fraction of proposed infrastructure spending can be spent before October of next year; the bulk would come long after. ...

... I think there is a better case for stimulating the economy through tax policy than has been made. Congress can change incentives instantly by, for example, saying that new investments in machinery and equipment made after today would qualify for a 10% Investment Tax Credit, and this measure would be in effect only for investments largely completed this year. Businesses will start placing orders tomorrow. By contrast, it will take many months before spending on public works begins to flow through the economy, and it is very hard to stop it when the economy turns around.

Stimulus based on private investment also has the added virtue of establishing a foundation for future growth, whereas consumption spending does not. As economist Hal Varian of the University of California at Berkeley recently put it, "Private investment is what makes possible future increases in production and consumption. Investment tax credits or other subsidies for private sector investment are not as politically appealing as tax cuts for consumers or increases in government expenditure. But if private investment doesn't increase, where will the extra consumption come from in the future?"

It's important to note, especially given his right-leaning conclusion, that Bartlett treats the discussion from a purely academic point of view, while much of the debate between supply-siders and Keynesians has actually been political. Readers are free to disagree, but I'd place the bulk of the blame for that with the latter group, which tends to see government spending as a means of reshaping society in a way that they believe to be better. They're less concerned, that is, with comprehension of economic reality than with implementing a social program.

In the current debate, that observation brings us around to the prognostications of Dick Morris that have gotten so much play over the past few days:

2009-2010 will rank with 1913-14, 1933-36, 1964-65 and 1981-82 as years that will permanently change our government, politics and lives. Just as the stars were aligned for Wilson, Roosevelt, Johnson and Reagan, they are aligned for Obama. Simply put, we enter his administration as free-enterprise, market-dominated, laissez-faire America. We will shortly become like Germany, France, the United Kingdom, or Sweden — a socialist democracy in which the government dominates the economy, determines private-sector priorities and offers a vastly expanded range of services to many more people at much higher taxes.

Obama will accomplish his agenda of "reform" under the rubric of "recovery." Using the electoral mandate bestowed on a Democratic Congress by restless voters and the economic power given his administration by terrified Americans, he will change our country fundamentally in the name of lifting the depression. His stimulus packages won't do much to shorten the downturn — although they will make it less painful — but they will do a great deal to change our nation.

What's the Stylebook Definition of "Independent"?

Justin Katz

It's not unreasonable to think such things possible in the United States as we tumble down the "stimulus" hill:

The French state will help provide free newspaper subscriptions to teenagers for their 18th birthdays, President Nicolas Sarkozy announced Friday. But the bigger gift is for France's ailing print media.

Sarkozy also announced a ninefold rise in the state's support for newspaper deliveries and a doubling of its annual print advertising outlay amid a swelling industry crisis.

Sarkozy argued in a speech to publishers that the measures are needed because the global financial crisis has compounded woes for a sector already suffering from falling ad revenues and subscriptions.

In a speech to industry leaders, Sarkozy said it was legitimate for the state to consider the print media's economic situation.

"It is indeed its responsibility ... to make sure an independent, free and pluralistic press exists," he said.

The obvious question is: From whom is such a press "independent" if it depends upon the government for funds? The sorts of people willing to put down their own money for subscriptions?

(Via Ian)

Et Tu, Cusack?

Justin Katz

Damien Baldino beat me to the punch, but the same thing jumped out at us both from this article about Massachusetts Governor Deval Patrick's consideration of toll booths at the border:

Robert Cusack, a member of the panel and an East Providence councilman, said that the Massachusetts governor has the right idea. As much as his own constituents would dislike paying fees and tolls, he said, he thinks they would rather pay a toll than live with a disruption to a state highway system in disrepair.

"We are the lowest state in the Union when it comes to our percentage of contribution to highway repairs. On average, states contribute 60 percent of the cost of repairing their highway infrastructure. We contribute somewhere between 20 to 30 percent, and have been relying on the federal government to pay the rest."

Cusack said people may complain about tolls, but New Hampshire has had tolls for a long time and no one complains. "New Hampshire has more severe weather, but their roads are in first-class condition because they have tolls to finance it."

Of course, tolls in New Hampshire are more of a use fee in lieu of taxes. Our taxes are already high — ostensibly with the roads included therein. Administrators and legislators throughout our state must get it into their heads that there is no viable long-term solution that involves squeezing more money out of Rhode Islanders.

January 24, 2009

Comments from the Chair

Justin Katz

Or maybe it was a bar stool; I couldn't see. Most of the talking at Thursday night's Young Republicans event was of a mingling sort among the 60–80 people in the room, so I didn't record it, but Travis Rowley and RIGOP Chairman Gio Cicione did offer more public comments:

I'd like to note, for the record, that mine is not the voice of the "woohoo" that one hears just after Travis mentions me.

The setting made it particularly appropriate, but Gio made a point that applies much more broadly than just to young Republicans:

When I got reengaged in the party about three years ago, it was through the Young Republicans and through somebody like Travis taking the reins and starting to do good things with this group, and two years after I got reengaged, I was the chair of the party. That's not necessarily a good sign for a party, but it's a good sign for the people in this group, because there is a lot of opportunity for people who are willing to put in the time.

Gio's is a common experience, in this state, from local taxpayer groups on up. Owing to dire need, willingness to engage and a bit of native intelligence can bring a person rapidly to positions in which it is actually possible to make a significant difference.

The Warm Glow of Press Affection

Justin Katz

It was a sad sort of laugh, but I couldn't stop the guffaw's escaping into the tire shop's waiting area when I read the following from AP writer Charles Babington (emphasis added):

At one point in Friday's meeting in the White House's Roosevelt Room, GOP Sen. Jon Kyl of Arizona objected to a proposal to increase benefits for low-income workers who do not owe federal income taxes.

Obama replied in a friendly but firm way that an election had been held in November, "and I won. I will trump you on that," according to several people briefed by participants who took notes.

Ah, the media: Supplying the "tone" that the president promised.

Turning Around the Train

Justin Katz

Apparently, I missed quite a show at the latest Budget Committee meeting in Tiverton, and it merits watching across the state. While East Providence is a battle occurring during free fall, Tiverton is an example of a municipality that can still choose to stop its train from speeding toward a collapsed bridge.

The town administrator and school department submitted their initial budget requests, on Thursday night, and there was some controversy over how seriously they should be taken and how much the public should treat these as actual government documents that will affect their lives. The usual process, as I understand it, is for the town administrator and superintendent to put together quick budget drafts to enable an unprepared town council and school committee to meet a charter-driven deadline. Over the next few months, the number typically grows, and then the Financial Town Meeting rubber stamps the budget.

That has to stop. My house is on the line.

My understanding is that the Budget Committee will have the full municipal budget on its Web page on Monday, but here's the summary page (click for a larger view):

Note the 5%, $822,542.77, increase and the lack of response to the probable cut in state funding, which I'm told will likely amount to roughly $1,000,000 .

At least the school department acknowledged the expected state cut of $242,638 in its budget:

Of course, from the Tiverton taxpayer's point of view, that admission mattered not at all, because the department already assumed an increase of taxes to the state cap of 4.75%, or $952,278. Moreover, the budget calls for an increase in expenditures of 4.06%, or $1,020,245, which is 46.4% greater than the expected increase in revenue. In other words, the district's initial budget overspends by $323,376 — even with the maximum tax increase.

That's for a district that will have 79 fewer students come the autumn.

The truly astonishing news from the school department is that the School Committee looks likely to pass the mostly retroactive increase in teacher pay on Tuesday night. The additional cost? $301,264. It's one thing to give away money and then find one's self short on unanticipated bills. It's quite another thing to have the two numbers in front of you and still opt to sign the check.

It gets worse. To even get within a few hundred thousand dollars of a budget that's already requested to grow by over a half-million, the district has to plan to reduce its staff by nine employees:

  • One full-time kindergarten teaching position
  • One grade 1 teaching position
  • Four full-time teaching positions at the middle school
  • Two full-time special education teaching assistant positions at the high school
  • One part-time elementary teaching assistant position

It also struck four new positions that it was considering, including a high school math coach who might have been able to do something about the town's losing ground on its high schoolers' math proficiency, which actually dropped to 24% (from 29%) in the latest round of NECAP scores (PDF.

And worse still: The "new" contract only lasts until August, so negotiations will have to resume in the very near future. When they do, the union will have been given no incentive to settle, because the principle of retroactive pay covering years of intransigence will have been reinforced, and it would clearly be a more profitable strategy to delay a final deal through these dark days of economic decline.

In Tiverton — as in many other places — the pain of the next few years is exacerbated, not alleviated, at ever tier of government. But there's still a chance that citizens, working from the bottom up, can apply the brakes.

A Little Morning Humor... and Disgust

Justin Katz

I sure hope Sheldon Whitehouse writes his own speeches, because I'd hate to think that somebody (let alone taxpayers) paid for this:

But for the duration of our Republic, even though our Republic is admittedly imperfect, that light has shone more brightly and more steadily here in this Republic than in any place on earth: as we adopted the Constitution, the greatest achievement yet in human freedom; as boys and men bled out of shattered bodies into sodden fields at Antietam and Chicamagua, Shiloh and Gettysburg to expiate the sin of slavery; as we rebuilt shattered enemies, now friends, overseas and came home after winning world wars; and as we threw off bit by bit ancient shackles of race and gender to make this a more perfect union for all of us.

The speech is overflourished throughout and peppered with a laughable naivete about political and governmental realities. Its purpose is to make a vague call for "discovery, disclosure and discussion" of the asserted misdeeds of the Bush administration, in which regard, Whitehouse is like the kid who so enjoyed mocking the disliked teacher that he wants the gang to go slash her tires after class.

A democracy repairs itself. Enough people wanted "change" that the country elected a president and legislature from the other party. The process of shifts in the following will traverse the natural course of our political and governmental system:

In short, when you have pervasive infiltration into all the halls of government - judicial, legislative, and executive - of the most ignoble forms of influence; when you see systematic dismantling of historic processes and traditions of government that are the safeguards of our democracy; and when you have a bodyguard of lies, jargon, and propaganda emitted to fool and beguile the American people.

The Senator is free to join the inevitable mob of hypocrites who treat as essential much greater reconfigurations than those for which they lambasted the previous administration (as with the "politically motivated" lawyer firings). But if Whitehouse wants a more significant purge than existing law has already set into motion with the change of administrations, then he's not just an oaf, but dangerous. In his blue blood ignorance, he'd usher in a North American Banana Republic.

As a constituent, I therefor request that my Senator repeat the last line of his speech over and over, like a mantra, for at least a half-hour per day:

I yield the floor.

(via Ian)

Suddenly, the Casino Rears its Ugly Head Again

Monique Chartier

I didn't support a full fledged casino when proposed with the facade of ownership by the Narragansett, for whom it is difficult not to have some sympathy. Why would I support it when 100% of the post-operator revenue would go to a government that, through the politically motivated actions of its elected officials, has been fiscally irresponsible for the last couple of decades?

State Sen. John J. Tassoni Jr. is proposing an amendment to the state Constitution to allow full-scale casino gambling at both Twin River and Newport Grand.

With a crucial deadline looming for Twin River to pull itself back from the brink of bankruptcy, House Speaker William. J. Murphy yesterday said state leaders are at a point where they need to consider all options, including a state buyout of the Lincoln dog track and slot parlor, to "protect'' the state's anticipated $246.8-million share of the slot revenue from there.

January 23, 2009

Gov Blago: They're Impeaching Me to Raise Taxes. (Yeah, that's the ticket ...)

Monique Chartier

Please don't take this guy away too quickly.

From the Chicago Sun Times:

Gov. Blagojevich continued to hammer away at the rules governing his upcoming impeachment trial this morning, saying the "fix is in in" and Illinoisans would be socked with massive tax increases should he be kicked out of office.

"They want to get me out fast so they could put a huge income-tax increase on the people of Illinois," the governor said in a 43-minute interview this morning on WLS-AM 890's Don Wade & Roma show. "It's either going be a 66 percent income-tax increase or a 33 percent income-tax increase. And they want to raise the sales tax on gas.

"They know I'm against those things, and I veto them. If I'm out of the way, they can quietly push this through."

Following upon his refusal to submit a witness list for his upcoming impeachment trial which he termed a "sham", he noted that

I can be soldier in the fight for constitutional rights.

A soldier on the humor supply line, anyway. We're with you all the way, Gov!

Those Who Face Reality, Those Who Do Not

Monique Chartier

AR commenters and contributors have observed for some time that the source of the budget problem now facing the state and locals is not a lack, demonstrated by our high property and other taxes, of revenue but rather, many years of imprudent spending.

In Providence, Local 1033 of the Laborers’ International Union of North America representing 1,900 city workers has offered concessions, including an 18 month pay freeze.

In Cranston, Local 153 of the National Association of Government Employees representing one hundred school custodians and maintenance workers have agreed to forego raises for two years and to contribute more towards health coverage.

Both sides called the contract a compromise, one that saves money and puts people back to work.

A job is a job,” said John F. Carbone, president of Local 153 of the National Association of Government Employees. “In layman’s terms, we were able to save five jobs.”

Tuesday night, East Providence City Councilors instructed legal counsel to research and report back on the option of municipal bankruptcy. By making such a request, it is clear that they are serious about their promise not to try to stick their taxpayers with a substantial budget shortfall. Quite simply, there is no more revenue to be had. Local 1033, Local 153 and the City of East Providence appear to be coming to grips with that fact.

As for "Those Who Do Not":

For Immediate Release

January 22, 2009

Statement from National Education Association Rhode Island (NEARI) President Larry Purtill in response to Judge Pfeiffer’s decision regarding East Providence:

We are disappointed in Judge Pfeiffer’s decision to deny the restraining order that would have stopped the East Providence School Committee from unilaterally rolling back teacher salaries and implementing a 20% co-share for health care. Teachers are being harmed by the loss of pay but we have confidence that the union has a good argument before the Rhode Island State Labor Board, who has initial jurisdiction in the case. At the moment, NEARI and East Providence teachers are considering all their options, based on the judge’s decision, including an appeal to the Rhode Island Supreme Court.

East Providence teachers, despite doing their job each day in teaching the students in their classrooms, are losing money and that will continue until we reach a resolution. With the anticipated increased revenue for education from President Obama’s Economic Recovery Package, the School Committee could put an end to this contract dispute by accepting the arbitrator’s award and or sitting down with the teachers in serious negotiations.

Are You Ready For To Get Pissed At Some Football?

Marc Comtois

The NFL is generally considered to be the smartest and savviest of the major sports leagues. But they are screwing up, big time, here (h/t):

The Super Bowl won’t let the military color guard stay and watch the big game? Yes you read that right. Was I skeptical? At first, but after I contacted the Tampa Bay host Committee through their official website and spoke to Katie Wagner, I was assured that yes in fact her email inbox is full of emails from upset Marine Mom’s all asking for an explanation. To Ms. Wagner’s credit, who by the way was extremely gracious during my questions the Host Committee has no control over game day decisions; that authority rests solely with the NFL.

What has become a common yet gracious act of allowing a military color guard to stay and watch the game from the side lines, in honor of their service to our country, this time has them being treated as if they are the unwelcome guests, common servants to be whisked away as soon as their task is completed.

Life's Potential

Marc Comtois


A Taste of the Healthcare Future

Justin Katz

Quite apart from the question of whether Governor Carcieri's Medicaid waver plan is the right move for Rhode Island at this time, it certainly provides evidence of the future of government-funded healthcare:

To save $200,000 in the 5 1/2 months remaining in this budget year, the Department of Human Services intends to seek bids to determine where a patient can go for the cheapest non-emergency surgery, a tonsillectomy being just one example cited by DHS Director Gary Alexander yesterday. A hospital? A surgical center? A doctor’s office?

The "selective contracting" of surgical services was just one of several money-saving plans that came to light yesterday after a second day of hearings on legislation to require General Assembly approval before the administration can use its new powers to limit, redesign or raise the patient share of the cost for any medical service covered by Medicaid.

Governor Carcieri is banking on at least $2 million in Medicaid savings this year to help avert a massive state deficit, and Alexander acknowledged this is also hinged on "selective contracting" with companies willing to provide the least expensive prescription drugs and medical equipment; a previously disclosed $10,000 liquid-assets maximum for adults to qualify for the state-subsidized RIte Care health-insurance program, and the "diversion" of 196 nursing home patients to alternative settings.

For some, there's no thinking beyond the immediate desire to make healthcare "fair"; they'll turn a blind eye to the water flowing onto the deck as they decry changes to government programs. They're willing both to let the state sink and to shove greater and greater numbers of the population a lifeboat that's already proven to have holes (probably because their whining can have some effect on a handful of politicians, whereas the market does what it does).

Grim Milestone, Not the Last

Justin Katz

Rhode Island has now (already) hit double-digit unemployment, at 10%, trailing only Michigan, with 10.6%. At this rate, we'll be lucky not to peak at 15% or greater.

A Rut Is a Rut

Justin Katz

Rhode Island Housing Executive Director Richard Godfrey provides the Business section headline — "Short supply of housing may help lift R.I. from crisis" — when he says:

"Most of the country is overbuilt," said Richard H. Godfrey, executive director of Rhode Island Housing. "Rhode Island is still underbuilt. We have a housing shortage." ...

But that offers a ray of hope looking forward, he said. While parts of the country that overbuilt will have to clear excess inventory of housing before prices stabilize, the Ocean State won't have to, Godfrey said. "I think that Rhode Island will actually be better in the long run, and may come out of the real estate crisis sooner because housing is still in short supply here."

I'm not sure how (or whether) he reconciles that with a subsequent statement:

Following the 1989 slowdown, Rhode Island enacted planning and zoning regulations that made residential development harder, he said.

"It really put a lid on all new building," Godfrey said. "And we haven't kept up with the housing need. Unless we reverse that, we can never grow economically because there's no place for workers to live or for customers to live. So that is really Rhode Island’s long-term issue: How are we going to grow economically with all of the prohibitions and all the difficulties on building?"

Whether there's an over- or under-supply of housing, people can't buy real estate if they haven't any money because they haven't any jobs, but if there's an under-supply, they'll be even less able to afford it. The higher prices mean that Rhode Islanders require even more opportunity — more recovery, if you will — in order to get the real estate market back on track.

That our state is so unfriendly to business, and that we're likely to be last out of the recession, having been hit particularly hard, will more than overwhelm any advantage gained by not having an excess supply of housing. Folks who are starting from a post-recession place of lowered reserves would do better in a market with too much property on the market, because the prices are lower, and if anything, Rhode Island may have constructed a trap from which they cannot escape.

Of course, many will continue to escape to other states, locking our recession in for years to come.

January 22, 2009

Trillo to Run For Governor

Carroll Andrew Morse

Multiple sources have informed me that State Representative Joseph Trillo (R-Warwick) has announced his intention to form an exploratory committee to investigate running for Governor of Rhode Island

Out on the Town with Republicans

Justin Katz


Well, the country boy made it to the city. Eventually, I broke down and paid $5 to park (next door, by the way). The room at McFadden's is pretty full, but there's still room if you can get here.

So far, I've bumped into Gio Ciccione, Mark Zaccaria, Jon Scott, Dave Talan, Bob Watson, OSPRI'S Brian Bishop, a few familiars from RIRA (Ray McKay, Will Ricci), and of course, RIILE' Terry Gorman, host Travis Rowley. (Oh, and some guy named Andrew Morse.)

A lot of very young-looking folks (guess I'm officially n my thirties). And oddly, I'm the only person using a bluetooth keyboard and cell phone to post to the Internet. The decline of the state of Rhode Island!

East Providence Teachers' Union Denied

Justin Katz

The East Providence School Committee just won the day in court — at least to the extent that the judge denied the union's request for an injunction against the imposition of the School Committee's remuneration change.

Decision: PDF
School Committee Press Release: PDF

Well, We' ll See

Justin Katz

Some of the things on which President Bush stood firm made even folks as far to the right as me wary, particularly when it came to "enhanced interrogation" methods. Not believing the insanely bloodthirsty image that his detractors painted of him (and for which they ought to be even more extremely embarrassed after the smooth transition), however, I accepted that there must surely be reasons that he was so determined to maintain certain programs.

It may yet prove to be the case that Obama's quick changes to such things as terrorist detainment will prove to be political shuffles that change the particulars, but not the practice, but if they prove substantive, well, I guess we'll find out over the next decade or so whether the Bush Administration tolerated all that political heat for no reason.

(One oughtn't discount the possibility, of course, that Bush's good reasons have faded sufficiently, mostly via success, to allow scaling back, and the further possibility that he held on to his policies for longer than he had to.)

Why Don't They See This?

Justin Katz

In a press release announcing his nomination for Director of the Department of Administration, Governor Carcieri says of Gary Sasse that he has "more than 30 years of experience in crafting and analyzing sound fiscal policies and sustainability for government programs," but I'll risk exposing my ignorance to scratch my head at the proposal taking shape in Sasse's tax panel:

The changes, if adopted, would have far-reaching effects on thousands of taxpayers.

Middle-income taxpayers would generally pay more, while lower-income taxpayers and some higher-income taxpayers would generally pay less. ...

Broadly speaking, people with $30,000 or less in AGI would wind up paying less in tax than they do under the current system.

People with between $30,000 and $110,000 in AGI would end up paying more.

Most people with AGI above $110,000 would end up paying less. But those with the very highest incomes, above $5 million each in AGI, would pay more.

That "middle-income taxpayer" group describes pretty precisely the range of households from which Rhode Island is losing population every year, and such folks are crucial to economic recovery and growth. The rich have money to invest, yes, but they're not the ones who'll put in 80-hour workweeks to keep industries developing. What Rhode Island needs is to match the investment-ready dollars with people who can use them — people in the middle-income group who need reassurance that their efforts will bring them closer to six-figure salaries.

That makes these suggestions downright pernicious:

... taxpayers would no longer be able to obtain a state tax benefit by making a separate list of their deductions, a process known as itemizing. ...

Under the plan, favorable treatment would be eliminated and capital gains would be treated as ordinary income, the same as wages, for example.

As far as tax rate is concerned, the thousands of dollars that I've invested in tools each of the last four years are of little concern. In terms of both investments and income, the big-nose/big-toes tax regime draining the middle for the benefit of the edges would pound yet another nail in Rhode Island's chance for innovation and accelerated growth.

How is it that such apparently qualified panelists can miss this perspective?

Praise Song for That Day

Marc Comtois

Yesterday, Dan Yorke was talking about the inauguration poem, "Praise Song for the Day", by Elizabeth Alexander and asking for impressions. For his part, Dan thought that it was a solid effort that was essentially a snapshots across America (a "literary split screen" as Dan called it). He thought that it could have been improved upon both stylistically and in the way it was presented. His callers ran the gamut--people confessed to being confused, uplifted, or...whatever. Overall, it was a good bit of "lit-crit" on the radio. For my part, I shot off a quick email that Dan read on the air:

Dan, I agree….a “literary split screen” on a day in the life is a good way to put it. But the end [of the poem] is important:

”In today's sharp sparkle, this winter air, anything can be made, any sentence begun. On the brink, on the brim, on the cusp -- praise song for walking forward in that light.“

See, it’s not about just any day, Dan, but that PARTICULAR day. The day when the ONE (Obama) has ascended. To me it was yet one more creepy, though predictable, aspect of the whole over-the-top, messianic feel of this inauguration. Another example of people thinking that, somehow, the election of a politician has single-handedly made everything better. Simplistic.

I've tried to explain this before, but historian and commentator Victor Davis Hanson has honed in and hit on what really bothers me:
I distilled from the press coverage and the crowds and the punditry yesterday that for all too many suddenly a vote for Obama redeems America. Now, to paraphrase Michelle Obama, for the first time in their lives they are apparently proud of the United States....So I am surprised that suddenly the election of a single individual means that we are united, patriotic, proud of America? Suddenly Okinawa or Antietam, or all those who died at the Argonne, are ours to claim again?

....But America was always ours, the public, and the nation transcends the proposition of whether Obama gets elected or not—given that the United States, in its worst hour, was better than the alternatives at their best. So I think it would be wise to cool it on the “I am now proud of America” rhetoric. If getting your way means suddenly the dead at Iwo or those who were blown up in B-17s over Germany are at last your own and matter, then we are in deep trouble.

History did not begin on January 20, 2009.

The First Great Punchline of the Administration

Justin Katz

Jason Jones delivers it on Jon Stewart, just after Stewart has illustrated the striking similarities between Bush's rhetoric and Obama's:

It's like, why is cheese delicious on Italian food, but when you melt it on Chinese food, it's disgusting. I don't know. I guess when Obama says this stuff, I don't think he really means it, and that gives me hope.

That pretty well captures Obama's allure: People across the political spectrum believe him when he speaks their language and hear only necessary white lies when the words come out the other side of his mouth.

Treasurer Caprio on Pension Performance

Carroll Andrew Morse

Rhode Island's General Treasurer is also the chair of the state's investment commission, which as part of its duties determines the asset allocation of the state pension fund. (Professional fund managers then decide specifically which funds to put the money in).

Breaking news: You may have heard that that markets did not do so well in 2008. Treasurer Frank Caprio quantified exactly how badly the Rhode Island retirement system was hit between June 30, 2008 and October 31, 2008, and provided a comparison to several other benchmarks…

State of Rhode Island-19%
City of Providence-30%
Harvard University
(aka the Gold Standard of Institutional Investors)

We asked the General Treasurer what the ramifications of a sudden 19% downturn for the pension system were…

General Treasurer Frank Caprio: The pension system values the fund with a five-year smoothing, so any one big positive or negative year doesn't really move the needle as you would expect. We take five-year blocks and average those years. A down year has an impact, no doubt about it, but it's not as if our fund is viewed as having dropped by whatever our negative number is for the year. Most large pension funds use this type of smoothing.

Now, we will be penalized for that too. In strong positive years, you don't get the full benefit either, as they're averaged again over time. If you look at the value of our fund at any point in time, there will be two numbers, what the fund is actually trading at, and what the five-year smoothing is. On the way up, you usually lag where the fund actually is. And when you have a down year, it's factored in over the five years. So there is an impact, but it's not an immediate impact.

Anchor Rising: There are some non-fiscally conservative people out there who would like to reamortize the whole system and start the clock again…

FC: I've talked about the thirty year mortgage, where we've paid ten years and have twenty years to go. What they would want to do is say let's cease that and start a new thirty-year mortgage. Just like any mortgage, if you paid ten years, assuming the value of the house hasn't dramatically decreased, when you refinance, you have the benefit of spreading out a smaller liability over a longer period of time.

That type of engineering is fine if you're making other material changes that benefit the taxpayers. But if you are just doing those one-time gimmicks, that's not going to strengthen the system for the long term. If you want to do that in conjunction with some of these other things that are being debated that materially reduce the liability, then that's something that not only a policy leader can live with, but that the rating agencies will look at as neutral or favorable and not mark you down for.

Treasurer Caprio on Pension Reform

Carroll Andrew Morse

During Anchor Rising's interview of Rhode Island General Treasurer Frank Caprio, Treasurer Caprio presented the results of several case studies illustrating how the pension reforms implemented in 2005 have helped bring the cost of Rhode Island's pension system in line relative to the other New England states. One set of analyses compared benefits owed to a state retiree with 30 years of service and a final salary of $57,000 who retired at age 55 -- as was allowed in the pre-2005 system -- to what is owed to a state retiree with the same service time and salary who retired at age 60, under the post-2005 schedules…

  • The ERSRI benefit under [the pre-2005 schedule] is 48% larger than the average in the other five states, and the APV is 60% larger than the average.
  • The benefit under [the post-2005 schedule] is 7% larger than average, and the APV is 15% larger.
The 48% and 7% figures represent differences in first year payouts; the APV figures are the "actuarial present values", which are estimates of the total costs of all future-year payouts to a retiree.

Treasurer Caprio also added this observation…

If you think about costs increasing in our state, when the average household is bringing in $39,000 -- that's an actual stat from RI -- why should that household be supporting a pension benefit for a state employee that is going to be much larger than what the average household in Rhode Island is getting by with and have a 3% increase compounded on.
We then asked the Treasurer about the unfunded liability, which he discussed with us in some detail...

General Treasurer Frank Caprio: Here's how I like to conceptualize the unfunded liability. Assume that we're buying a house, and the house costs $700,000. We're going to have to put in place a mortgage to buy the house…over 30 years it gets paid off. Change those numbers; the unfunded liability in Rhode Island is about $7 billion for our pension. We have $6 billion that we have to pay it, but then we need another $7 billion to be fully funded.

Anchor Rising: And that's to pay out if everybody works a normal working career, retires, and lives an actuarily determined lifespan?

FC: Correct. The actuaries will make a bunch of assumptions. Usually, they're pretty close to being accurate. Large numbers are in play here. You look at the past practice and experience, and you overlay that onto the future.

Think of the house example. We have this liability and we're paying a yearly payment in the form of a mortgage. After 30 years, we'll have no debt on this asset. Now, think of the same concept with the unfunded liability. We have a $7 billion unfunded liability. We are currently paying between the state and the municipal payments into the system...about half-a-billion dollars a year in employer contributions. The reason we're doing that is we're 10 years in on a 30-year plan. 20 years from now, we'll have a fully funded pension system. The system gets high marks – when I say system, I mean the state of Rhode Island -- because we've anted up the payments on that mortgage, so to speak.

What the changes that are being proposed to the system do is take that $7 billion that we currently owe and shrink it, because by not guaranteeing that 3% a year cost-of-living adjustment, our future liability becomes much smaller. It will shrink by about 25% and therefore our "mortgage" payment can shrink. That's what's being attacked, by changing the benefit formula and not being able to retire at any age.

AR: What changes would you like to see?

We have to save somewhere between $100 million to $150 million on our pension costs. With the budget strain we have, about 25%-30% of the strain is caused by the employer, taxpayer contribution. One end would say let's go to a 401(k) style self-directed plan, the government should not be in the business of putting extra money in to the level that we do. The issue with doing that currently is that it would cost us about $500 million over the next 5 years. We wouldn't save the $500 million we're trying to save, and it would cost us $500 million, so it's about a billion dollar swing. I'm answering your question with a specific answer, not theoretically as if in a perfect world, what would you do. We have to play the hand we're dealt…

AR: That cost is related to accounting rules, right?

FC: Yes. The reason why that would happen is if you close a defined benefit system like the state currently has, it accelerates certain schedules of payments that you as the employer have to make. The government has put in place a little bit of a soft-landing, so people can't whipsaw from one decision to another and there's some financial ramifications for doing it. If we're going to do it we have to come up with more money, not save money, so again it puts us in the wrong $500 million, not in the right $500 million.

AR: And I know you don't have any control over those accounting rules, but as someone who's on top of their financial ramifications, do those rules make sense? Is it a good thing that that rule is in place, or is it something that's getting in the way of doing the right thing?

FC: It's good financial management practice, because the state taxpayers are going to be responsible for those payments, one way or another. For the state, it's better to have a fund set up with the requisite assets in it to pay those future liabilities and not continually go back to the taxpayers. The worst case scenario is you end up with a pay-as-you-go system, which we've seen examples of in cities and towns, where they don't have put enough money aside and there's a line item in their budget every year to pay pension benefits.

A second potential would be what's called a hybrid system. In a hybrid system, you have a portion 401(k) self-directed benefit, you have portion like the state current has, defined benefit, but nowhere near 60-80% of your highest three years; instead maybe 20-40% of your highest three years, and then you have social security. All state employees and most school teachers, not all, but most participate in social security. Retirement then becomes a three-legged stool.

On Interviews and Interviewees

Justin Katz

Marc and Matt talked Caprio and interviews on last night's Matt Allen show. Stream by clicking here, or download it.

In answer to questions, insinuations, suggestions, and allegations: Yes, we're certainly interested in, and will in the future make efforts to facilitate, doing such interviews with other folks in the public eye.

January 21, 2009

With the Medic

Justin Katz

Bob Walsh is currently recovering from a stroke experienced during surgery. God willing, he'll quickly be back in full form; hopefully he'll take the meantime as an opportunity to enjoy a break from the battlefield.

(N.B. — When it comes to the comments section to this post, leave your blackjacks and billy clubs at the door.)

A Church of the Mind

Justin Katz

Among the factors that drew me to the Roman Catholic Church is that it essentially rejects the construct that insists that faith and reason are opposing sources of knowledge. They're not; they blend and overlap and are ultimately inseparable. On those grounds, and with consideration of the times in which we live, Rev. Joseph Lennon, of Providence College, issues a call for the renewal of a Catholic intelligentsia:

Love of learning for its own sake, a conviction that reason will prevail, a consuming desire bordering on obsession to get to the root causes of things — these are keys unlocking the door to an understanding of the intellectual. Democritus declared he would rather discover a single demonstration than win the throne of Persia. Thomas Aquinas became so enraptured with ideas that he would often forget to eat and drink. Once Thomas' absorption in theological speculation grew so intense he felt no pain while having his injured leg cauterized. ...

Catholics deem it sinful to revile or ignore reason, so intellectuals are warmly embraced by the Church. Thomas Aquinas exalted reason to a degree that seemed scandalous and sacrilegious to the reformers who came 300 years after him. One of the meanings of Logos in St. John's Gospel is Reason, and Logos is God. So, under penalty of blaspheming God, Catholics dare not be anti-reason and therefore anti-intellectual. ...

In defending supernatural revelation against heresy, the Church, at the same time defends natural reason and the primacy of the intellect over the will, the emotions, the instincts or any of the other faculties to which voluntarism always appeals.

The times do require a public voice tempered with the confident conviction that only the interlocking gears of faith and reason can instill.

Just So Will Healthcare Fall

Justin Katz

It amazes me that we can watch these things, which should have been entirely foreseeable, and never return to our initial premises:

Some of the big-name Boston teaching hospitals that have managed to extract higher insurance payments include Children's Hospital and the members of Partners HealthCare, a group including Massachusetts General and Brigham and Women's. As a result, they may be paid two or three times more than a community hospital for the same procedure. ...

In addition to helping raise the average Massachusetts family's premiums by 78 percent since 2000, the 800-pound-gorilla hospitals are using their enhanced profits to expand into the suburbs and take business from smaller hospitals. For example, Partners has built a $43 million outpatient clinic in Foxboro, not far from Caritas Norwood Hospital. The objective is to drain day-surgery patients from Caritas, which because of its lower insurance reimbursements, is $4 million in debt. Caritas asserts that were it paid the same rate for delivering babies as the Partners hospitals, it would have lost no money in the third quarter.

Ensure funding for anything, and prices will go up. Increase the distance between the customer and the payment, and advantaged suppliers and middlemen will leverage their power for even greater dominance. And then comes the predictable reaction:

In response to these revelations, Governor Patrick has proposed having state insurance regulators stop excessive premiums. And he has convened a panel to embark on cost-containment steps in Massachusetts, something that is long overdue.

So now prices will ultimately be determined by a government whose interest is more directly in the payments than the service provided, conducted by a panel whose power is appointed, overseen by politicians whose underlying job is to raise money and be reelected.

What do you suppose will happen next?

General Treasurer Frank Caprio on E-Verify and Immigration

Monique Chartier

Further to Justin's post, below is a transcription of General Treasurer's remarks on these matters.

AR: Do you support e-verify? Did you support e-verify?

GT: I wasn't in the Legislature for that. That was more in the last two years. So I didn't vote on that because I was here, not there.

I think we should follow the laws in this country. We're a country of laws.

You know, this isn't the first time this country has dealt with a large wave of immigration. Between 1915 and 1925, we had in Rhode Island the fifth most active port of entry in the country. And about 100,00 immigrants from mostly Italy and some from Portugal went through that port of entry at Fields Point. At the same time, Ellis Island was going full tilt and other ports of entry on the East Coast. And there was so much immigration of people from mostly that section of Europe that the Congress responded with the Quota Act in 1925 and effectively ended immigration at that point in time to America.

Now, my grandfather, whose picture is right there selling fruit from the push cart, he was one of the immigrants between 1915 and 1925 who came through that process. He was one of ten children. They all came, both that left Naples, Italy and came directly to Providence.

So I'm not against immigration. I'm not against people from foreign lands coming to America and being able to fulfil their dreams here. But we need to have a process in place that works for not only the country but for those who want to come here. Currently we don't and I fault people in Washington for that. It's a broken system.

Caprio on Port Development

Marc Comtois

During our discussion with General Treasurer Frank Caprio, I asked him for his perspective on port development in both Providence and Quonset. He responded (stream, download):

I think we need to focus on a cluster of industries, not get...not play the timing the market type of thing--if something's hot now let's push for it. We need a strategic plan as to how we're going to get there. We can't float from EDC Director to EDC Director....I think we have an opportunity, especially with the re-shaping of the financial world. I don't think it's going to be as in vogue to be in the 61st floor in some skyscraper in Boston. So maybe we can use those things to our advantage, but we need a tax structure in Rhode Island that puts us on the playing field.
His line of thinking is in agreement with many others, including Ed Achorn:
[Governor Carcieri] has stubbornly opposed a containerized-cargo port at Quonset Point since he was first a candidate for the office, and his economic-development efforts have been, to put it kindly, ill-considered. While the state has shed thousands of real jobs, the governor has been wandering down pretty side paths with his Economic Development Corporation, exploring boutique ideas and tossing around such buzz phrases as “innovation factory” and “information economy” while ignoring the state’s greatest comparative advantage.

Granted, much of Rhode Island’s difficulties, which long predated the national recession, can be traced to its uncompetitive taxes, unfriendly business climate and generally mediocre public schools.

Caprio also mentioned his philosophy--going back to his days in the Legislature--of reducing capital gains taxes in the Ocean State to be more competitive with Massachusetts. He also agreed with my suggestion that keeping up with Connecticut and Massachusetts was nice, but we should really strive to be MORE attractive to business than our neighbors.

A Creeping Emergency

Justin Katz

It's a few days old — which in Internet time is a matter of months — but Mark Steyn's column on the mission creep of FEMA is worth a read if you haven't gotten to it, yet:

The proposition that a new federal administration is itself a federal emergency is almost too perfect an emblem of American government in the 21st century. FEMA was created in the 1970s initially to coordinate the emergency response to catastrophic events such as a nuclear attack. But there weren't a lot of those even in the Carter years, so, as is the way with bureaucracies, FEMA just growed like Topsy. In his first year in office, Bill Clinton declared a then-record-setting 58 federal emergencies. By the end of the Nineties, Mother Nature was finding it hard to come up with a meteorological phenomenon that didn't qualify as a federal emergency: Heavy rain in the Midwest? Call FEMA! Light snow in Vermont? FEMA! Fifty-seven under cloudy skies in California? Let those FEMA trailers roll!

The Cato Institute's James Bovard was struck by the plight of Vernon, Conn., a town ravaged in the winter of 1995-96 by, er, slightly more snow than they'd expected. So FEMA sent them a check for $40,023. Vernon had 30,000 people, and its town snow-removal costs that winter were $258,000. "That's just $8.60 per person," Bovard pointed out, "less than a 12-year-old charges to shovel out a driveway after a good snowfall."

So why did they need "federal emergency" aid? Because the town had only budgeted $104,516, and so claimed to be "overwhelmed" by the additional costs. They could have asked the good burghers of Vernon to chip in an extra five bucks apiece. But why bother when FEMA's so eager to give you a warm bath in the federal love nectar? The town government wised up pretty quickly. The next winter, they set the snow-removal budget at just $69,383.

Everything inches toward the federal government, it seems, because power has a sort of gravity. (Next will be the international level.) Eventually, though, you end up with an uncontrollable mass in which citizens can only suffer.

Sitting Down with the Treasurer

Justin Katz

RI General Treasurer Frank Caprio invited Anchor Rising for a sit-down chat in his office last night, centering on pension issues, but touching on various other matters.

In general, I think the four of us in attendance were reasonably impressed with the treasurer's explanations for economic policies and his knowledge of political history in Rhode Island. In specific, some of the more detailed material is going to take time for us to digest prior to comment, but a few clips might be of interest to readers right off the digital recorder:

  • On complete financial transparency in his office, to be unrolled in a few weeks: stream, download
  • In opposition to the use of state-owned vehicles: stream, download
  • I got a chuckle out of the notion of fear among those in his office promoted beyond the union's bounds to become (scary music) at-will employees: stream, download
  • Caprio's got a merit-based promotion system in place with his workers' union, and he thinks the practice is transferrable across government: stream, download
  • Apparently, Rhode Island "only" pays 7% of its revenue toward debt service. I wasn't wholly satisfied with the Caprio's description of the comparative appearance of that statistic against a typical business and wonder whether it's fair to compare the government to a mortgage-paying household: stream, download
  • On the possibility of municipal bankruptcy (or entry into "a process"): stream, download
  • On his pension-plan thinking. Apparently, much of the cost of switching to 401k would come from accounting rules, but with the possible loophole of diminishing, rather than "closing" the defined benefit program: stream, download
  • The reason that Rhode Island actually ranks pretty well when it comes to retiree healthcare costs: stream, download
  • On abortion and same-sex marriage, neither of which would be his center of focus for any campaigns or offices: stream, download
  • Running for governor?: stream, download
  • Wherein I continue to strive for an answer on the social issues: stream, download
  • On eVerify and immigration: stream, download
  • On branding the state otherwise than with corruption and mob films: stream, download
  • With regard to a port project and other initiatives, the treasurer agrees with me that a broadly attractive economic environment (tax cuts included) ought to be the focus of policies: stream, download
  • An interesting response to my question about his thoughts on Republicans running as Democrats ("Why not the reverse?") and a discussion of the RIGOP: stream, download

January 20, 2009

Who Said Republicans Aren't Fun?

Justin Katz

As we old folks get our act together, on the political scene, we should ensure that there's a continuity stretching down to our younger right-of-center compatriots. So, if you can put down that new book about Reagan and Buckley for a couple of hours on Thursday night, you might consider joining me here:

Join us at McFadden's, at 52 Pine Street, in Downtown Providence next Thursday night, January 22nd, from 7:30pm to 9:30pm, for our 2009 Kickoff Event.

McFadden's is providing us with free appetizers and drink specials. All we have to do is show up and make fun of Democrats for a couple hours.

Local Governments Must Lead

Justin Katz

With reference to his native Warwick, Bob Cushman makes a call applicable to all of Rhode Island's cities and towns in varying degrees:

Those who wail and gnash their teeth in response to the governor's proposals are more interested in playing the blame game than recognizing the reality of the situation and making the tough choices necessary to get our economy back on track. The change we need to protect the rights of taxpayers will not be easy. But it cannot even begin until our leaders recognize their complicity in this crisis and get serious about fixing things.

The simple fact is that Warwick taxpayers cannot afford another year of tax increases in this economic environment. To do so may very well force people into the streets. Delinquent property tax collections are already increasing. Tax revenues are down everywhere because people don’t have the money to spend.

It will take political leaders with the courage to confront these challenges with honesty, diligence, and a sense of shared purpose. But the first step is to stop pointing the finger of blame elsewhere. You were elected to lead. So lead. Have the courage to adopt the position of creating a more efficient government by cutting spending and pledging "no new tax increases in 2009" so all Warwick citizens can survive this economic downturn and share in the wealth of the recovery when prosperity returns.

Anchor Rising readers have likely furrowed their brows at suggestions that the governor is merely shifting the tax burden toward property taxes — forcing local governments to raise them. A whole lot of people in this state don't want the notion that government spending can be cut to enter the public discourse. Yes, even at the town level.

I've Heard Better

Justin Katz

Here is the text of President Obama's speech. His victory speech was much better, not the least because it was much more gracious toward and tolerant of the other side. Among the first statements issued in the president's new, "unified" tone?

On this day, we come to proclaim an end to the petty grievances and false promises, the recriminations and worn out dogmas, that for far too long have strangled our politics.

We remain a young nation, but in the words of Scripture, the time has come to set aside childish things.

He read that as one paragraph, by the way, making it a complaint against his predecessor, not a statement of national growth. "Unity," in this usage, means the other side just gives in.

One other thought that occurred to me while listening to the speech was that we have been proven correct who have been noting that the nation's handling of race had already changed, and that the liberal methods of addressing it were merely prolonging discord. The conditions were amenable to Obama, just awaiting the right individual.

That is not to deny that it is quite an achievement for him to have been that individual, but a testament to the goodness of our country.


Carroll Andrew Morse

(I guess I haven't set aside childish things just yet!)

So How Will He Do?

Justin Katz

Fans of our new president perhaps imagine us non-fans as scowling through the day today, embittered by all that hope and rueful of the change to come. Me, I'm just going about my business, as I have on every inauguration day within my lifetime. That said, Andrew Stuttaford's suggestion is an attractive one, although I can't afford any of the Obama-branded merchandise that he subsequently lists:

It's better, I think, to borrow a few ideas from the Orange Alternative (Pomaranczowa Alternatywa). Fearless prankster surrealists of the Polish sort-of-Left from the 1980s, they used to taunt their country's crumbling Communist regime with cheers, not jeers, their specialty being sporadic displays of unsettlingly enthusiastic loyalty. These included a reenactment of the storming of the Winter Palace and a procession through the streets of Warsaw by 4,000 people chanting their love for Lenin. Now, I would not want to compare Obama with that other community organizer—no, not for a second!—but the cult of personality now surrounding our next president suggests that hosting an Orange Alternative inauguration dinner would be a perfect counterpoint to the pomp, sincerity, and cynicism on display in Washington. It'll also be an ideal opportunity to treat friends of all political persuasions to a confused, confusing, and almost certainly annoying celebration that can be read, as Obama has said about himself, in any way they like.

With a little more notice, a Long Live the King party might have been a pleasant way to spend this evening. Indeed, we could have begun with an extolment of a newly introduced bill from U.S. Representative Jose Serrano (D, NY) to repeal the 22nd Amendment and enable a longer reign for the One. Several party games involving the national debt and antes of coolness also come to mind.

The levity does raise a serious (if unanswerable) question, though: How is President Obama likely to do? The variables are infinite, and the wildcards too many to count. Not the least of the unknowns is what Obama will do, because his past is like a novelist's thumbnail sketch of a character. He's all personality.

The economy will be the irreducible determinant of his level of success, and there's little a president can actually do to affect it. Within the degree of economic influence that the government can be said to have, the general approach suggested by Obama and the Democrat Congress (with complicit Republicans, to be sure) does not give reason for optimism.

In order to escape recession and surpass stagnation, the economy requires an open field. That running room can emerge with a new technology that creates whole new industries. It can open up literally as new space to fill. Innovative financial tools can create economic activities as if out of air (or, as was the case with the recent bubble, make future income the open field). Where the government has built artificial walls, knocking them down in a spell of deregulation can free the economy. A newly opened national market can bring a burst in demand.

All of these possibilities are of like form — involving the creation, development, or discovery of voids that the economy can surge to fill — and none look likely in the near future. Put what hopes as we may into the everything-green movement, nothing new is being created; energy is still energy, and more cost-effective ways exist for creating it. The emphasis on government spending and "shovel ready" projects as stimulus may run the economic engine, but with nowhere to go, and eventually we'll run out of our borrowed fuel. New financial tools and deregulation are probably out of the question in the short term. And the international market is fraught with nations acting in their own interests.

Dealing with those foreign bodies is another variable. I believe the major players will postpone testing and challenging Obama for a while — not because the world sincerely wishes to see if the new U.S. president will govern in a way more to their liking than his predecessor, but out of strategy. If he takes his foot off the accelerator in the War on Terror, terrorist groups won't attempt an immediate strike; they'll regroup and rebuild, taking into account lessons learned since 9/11. Foreign powers such as Russia and China will want to see how sympathetic and manipulable Obama is. They'll begin to test him in ways so minor that it won't be immediately apparent that that's what they're doing.

In the meantime, once the elation of a new presidential face subsides, domestic turmoil may simmer as economic frustration spills over into the culture war. The left has its wish list out, and with Democrats controlling two branches of government, it will expect results. For its part, the right is arguably enlivened when on the defensive.

So in all of this, how will President Obama do? I won't hazard to say, but I will offer a three-part generality: Liberalism is a recipe for disaster; centrism is an inadequate approach when the economy requires inspiration, foreign affairs require a set jaw, and the sides refuse to let social issues balance; and powerful institutions have installed constructs to make conservatism a very painful option. Obama will probably shoot for a leftish centrism until circumstances knock over the fulcrum.

The real change, that brought by the tectonic forces of history, could be serendipitous or calamitous. Which it will be and how the president will react are questions sure to bring silence to the party.

Mighty Mouse Versus Yosemite Sam

Justin Katz

It's kinda funny to contemplate what local establishment figures and their one-mind sympathizers imagine about reform groups. Former school committee member (and foiled town council candidate) Michael Burk likens Tiverton Citizens for Change to a false Mighty Mouse and whispers spooky insinuations that would surely spark laughter in anybody with a reasonable understanding of the scope of town government:

On September 15, 2008 Mr. Gerald Felise contributed $1,000 to the TCC. However, on October 7 the TCC filed a CF-5 with the Board of Elections stating they would accept donations of no more than $100 from any individual and no more than $1,000 from all contributors combined. Yet they still didn't report any contributions/expenses until November 17 – 13 days after the election and two months after Mr. Felise's contribution.

Rhode Island law prohibits political contributions from corporations. The TCC's Novemer 17 filing listed Mr. Felise as an individual donor with his home address as 896 Fish Road. His business, eCo Industrial Park Corporation of Rhode Island, also has an address of 896 Fish Road.

Jump ahead to the December 11 Sakonnet Times. Mr. Felise is proposing a "Giant 'eco-development'" on both sides of Route 24. Did Mr. Felise, obviously a strong TCC supporter and probably a member (they don't release their membership list), present this to a meeting of the Planning Board or the Town Council as would be the appropriate first step? No, he chose to present it to "a meeting of invited town officials and residents at the company’s offices at 896 Fish Road" the Friday after Thanksgiving. The timing of this was so close to the TCC's purported election victory that it seems rather odd to me. Mr. Nelson would like us to think that he and the other leaders of the TCC knew nothing of this proposal prior to Election Day.

The first part is an accusation that we've already covered. Trying to hit the ground running in mid-summer — and having no expectation of large or numerous donations — TCC opted for the easier route requiring less time filing reports. Mr. Burk doesn't bother to explain this, but that's the purpose of a CF-5: to minimize unnecessary paperwork, not to forswear large donations.

But we did receive that one large donation — and many smaller ones — so campaign finance law required us to begin filing regular reports. That's the process described on the CF-5; there's no actual or intimated violation involved. Owing to some confusion during a very hectic time, however, our first report missed the deadline, so several of us spent a late night filling out forms. Nothing nefarious.

That night, as it happens, was the first time I'd ever heard Mr. Felise's name, and to my knowledge, nobody active in TCC was aware of his plans. I don't believe that any of us had so much as met the man. As odd as the timing may appear to Mr. Burk, that's all there is to it. The tale that he weaves tells the reader much more about his and others' paranoia than about TCC or (I can only surmise) Mr. Felise.

One needn't have memorized the group's secret knock to have observed its formation: The results of the financial town meeting brought several previously known trouble-makers (me among them) together with existing non-establishment groups (notably the retirement communities) and some newly aggrieved residents. In the handful of months leading up to the election, we recruited and endorsed candidates mainly with the next FTM in mind. The calendar left us very little room to address anything else.

Now that the election is over, we hope to begin exploring the multiple issues that ultimately contribute to the budgets that the town passes each year, but the effort hasn't yet begun. We haven't discussed, for example, whether Mr. Felise's development is something that TCC ought to back. When we do take the matter up as a group, enough of us are sufficiently idealistic that large donations are unlikely to be of more than passing interest. Moreover, when we put forward arguments on any issues, interested residents will be able to judge them on their merits, with due consideration of our own finances.

For Michael Burk's part, the merits of Mr. Felise's project seem to hold no relevance. Some conspiracy is necessary to explain the rapid emergence of a vocal taxpayer group, and a businessman wishing to invest in the town makes as good an evil conniver as any. Nevermind the individual histories of the group's members. Nevermind the fact that Mr. Burk proclaims no evidence apart from what we have made available.

Nobody active with Tiverton Citizens for Change believes that we have all the answers. All we have are voices and an interest in using them to offer arguments that we feel haven't been adequately made in the past. We don't see ourselves as swooping in to get Tiverton "well in hand," as Burk quotes from the Mighty Mouse theme. We're more interested in asking questions, offering suggestions, and doing what we can to keep individual egos and personalities from dictating the direction of our town.

We're a bit more like Bugs Bunny than Mighty Mouse, I'd say — trying to get through each episode with little more than a sense of humor and a knack for dodging the throes of absurdity.

So fire away, Mr. Burk, for the plot needs its Yosemite Sam.

January 19, 2009

That's Quite a Change, Alright.

Justin Katz

$40-something million? How about $170 million:

The country is in the middle of the worst economic downturn since the Great Depression, which isn't stopping rich donors and the government from spending $170 million, or more, on the inauguration of Barack Obama.

The actual swearing-in ceremony will cost $1.24 million, according to Carole Florman, spokeswoman for the Joint Congressional Committee on Inaugural Ceremonies.

It's the security, parties and countless Porta-a-Potty rentals that really run up the bill.

The federal government estimates that it will spend roughly $49 million on the inaugural weekend. Washington, D.C., Virginia and Maryland have requested another $75 million from the federal government to help pay for their share of police, fire and medical services.

And then there is the party bill.

"We have a budget of roughly $45 million, maybe a little bit more," said Linda Douglass, spokeswoman for the inaugural committee.

The rich among the do-good left can always come up with money for the important stuff:

"They are not the $20 and $50 donors who helped propel Obama through Election Day," said Massie Ritsch, communications director for the Center for Responsive Politics. "These are people giving mostly $50,000 apiece. They tend to be corporate executives, celebrities, the elite of the elite."

Kinda, Maybe on Step 1

Justin Katz

It's good to see that Governor Carcieri is standing by his budget, so far — although nothing's really happened to it, yet. I do wish he'd be a bit more forceful about this:

"I hope we don't need the stimulus money to plug the budget and if not, I'd like to see if there is some way — that is if our revenues don't fall off the table further — that we could use some of that money to actually phase in tax cuts," he said.

Among the changes he'd like to see if Rhode Island can afford it: Reductions in the state's corporate and estate tax rates and in the sales tax rate, which he'd like to drop from the current 7 percent to 5 percent, without broadening the tax base to include services and goods such as haircuts, movies and auto repairs as lawmakers have suggested.

Such steps ought to be the centerpiece of an economic renewal package. If we don't start to grow, plugging budget gaps will be an biannual tradition for years to come in Rhode Island.

Inauguration or Coronation?

Marc Comtois

The inauguration festivities seem to be particularly "big" this time around. Wonder why? It seems much more like a coronation than an inauguration (I know, this will probably be taken as me being just another cranky-con. Oh well). Anyway, Michael Drout, Professor of English and Chair of the English Department at Wheaton College (I don't know his politics), offers an illustrative recounting of a conversation he had in his faculty lounge:

Background: Wheaton has arranged for a sophomore January experience. Sophomores come two days early and do some stuff. This happens to be on the day of the inauguration, so the planners decided that all the sophomores could be brought to the field house where they would watch the ceremony on a giant screen.

Drout: (as tactful and politically savvy as I always am): I'm just glad I never had to participate in such a creepy experience when I was in college.

X: (confused): Why would you call it creepy?

Drout: You are rounding up a large group of people and forcing them to watch political theater. On a giant screen. In a gymnasium.

[Long pause while people look uncomfortable.]

Drout: It never occurred to any of you who planned this that it was the slightest bit creepy, did it?

X: The way you describe it makes it sound creepy. It is a major event that most people will want to watch.

Drout: Couldn't they watch it without being herded together into a gymnasium? Maybe hang out with their friends, watch it on the various lounge TVs? Make comments?

X: But then there wouldn't be the bonding experience.

Drout: Bonding over a political spectacle is, in your view, a good thing?

[another uncomfortable pause]

X: Maybe you should be one of the faculty members afterwards who can give talks to contextualize the event. You could analyze the rhetoric.

Drout: I'm pretty sure I don't want the students to see me as part of the creepy event.

X: But you'd have a chance to express your point of view.

Drout: But you've got my entire point of view. I think it's creepy.

X: (Gives up in exasperation).

Look, I do GET it. I really do believe that this is a significant moment in our nation's history. Yet, the 24/7 coverage of the week long celebration...I don't remember this happening before. Is it just because we, as entertainment/news consumers, are getting more demanding (or the suppliers of the aforementioned more aggressive?) when it comes to our politics-meet-entertainment appetite? I know there is a need to fill programming time--and what better way than covering inauguration festivities (plus, it's relatively cheap). To say nothing of the MSMs love for Obama.

I'm sure there are several factors that go into this. The coincidence of the inauguration of the nation's first black President with our annual commemoration of our country's greatest civil rights leader, Dr. Martin Luther King, Jr. has certainly, and correctly, heightened the emotions this time around. But the idea that we as a nation need to "bond" over the inauguration of a new political leader? It all seems just a little overboard. And creepy.

Fanatics in the Cabinet

Justin Katz

Jeff Jacoby has some suggested questions for U.S. Senators to ask Obama's nominee for director of the Office of Science and Technology Policy, John Holdren. The last one gives a sense of Jacoby's general concern:

8. You are withering in your contempt for researchers who are unconvinced that human activity is responsible for global warming, or that global warming is an onrushing disaster. You have written that such ideas are "dangerous," that those who hold them "infest" the public discourse, and that paying any attention to their views is "a menace." You contributed to a published assault on Bjorn Lomborg's notable 2001 book "The Skeptical Environmentalist" - an attack the Economist described as "strong on contempt and sneering, but weak on substance." In light of President-elect Obama's insistence that "promoting science" means "protecting free and open inquiry," will you work to soften your hostility toward scholars who disagree with you?

Mr. Holdren, it bears mention, appears to have a long history of erroneous alarmist predictions.

What's Going Up in Education

Justin Katz

As Marc and I have been illustrating, there are a number of ways to cut the data on education expenditures. That, indeed, is what makes it possible for unionists to declare this or that slice decisive, even if reality disagrees.

In the comments to Marc's post, for example, NEA Assistant Executive Director Pat Crowley seizes on Marc's observation that "the piece [of the education expenditure pie] that went to the teachers stayed relatively the same" from 2004 to 2007. In Crowley's estimation, that fact is proof that "collective bargaining costs are not what is driving the costs in education." Pat's really going for the bold, here, because "instructional teachers" spending is not the only subcategory directly dependent upon collective bargaining. He's also ignoring the fact that total education spending has gone up an average of 6% every year this decade (both per student and overall).

If the question is what subcategory of spending is driving up the cost of education in Rhode Island — or inversely, which subcategory has been soaking up our increasing investment therein — then the most direct insight will come from a graph depicting the per-student spending on each:

In the extended entry, I've provided similar graphs for various school districts that I found to be of interest for one reason or another. (I'd be happy to run more districts if readers have specific requests.) There are, of course, town-to-town variations that might be of interest to those familiar with the local particulars,* but the basic story is the same: Between roughly 2003 and 2005, funding switched from paraprofessionals (classroom aides and such) to therapists and other special- needs–related employees,** and funding for teachers has never ceased its climb. That, again, is excluding other subcategories that could justifiably be tacked on to the cost of teachers and — even more — teachers' unions.

* I find it interesting, for example, that Tiverton has seen such an unusual increase in pass-throughs, which include out-of-district services for special needs students as well as the limited resources redirected to private schools (such as some transportation costs and books). One reason could be that families that were priced out of better-performing districts like Portsmouth and Barrington opted for private school; another could be an increasing inclination to flee the public schools for any of the multiple private options available in the area. The protracted union "negotiations" can't have helped in that regard. It's also notable that Providence has such relatively low per-student spending on teachers. Whether that indicates a comparative lack of city funding or of state funding, I don't know.
** This shift from paraprofessionals to therapists probably explains why Crowley picked 2004 as the year for comparison with 2007: At the state level, 2004 marked the peak for paraprofessionals, which are counted in the "instruction" category that Crowley incorrectly uses as a stand-in for "teachers." His game is propaganda, not analysis.

January 18, 2009

Newly Discovered Concept: Self Interest

Justin Katz

I'm not sure why anybody's surprised at bailout recipients' reaction:

At the Palm Beach Ritz-Carlton last November, John C. Hope III, the chairman of Whitney National Bank in New Orleans, stood before a ballroom full of Wall Street analysts and explained how his bank intended to use its $300 million in federal bailout money.

"Make more loans?" Mr. Hope said. "We're not going to change our business model or our credit policies to accommodate the needs of the public sector as they see it to have us make more loans."

There's really no way around the reality of human nature and its self interest — especially when the decision makers are acting in their capacity as employees or representatives of business entities. Add strings, and the question will become one of cost-benefit, and in this case, the government wanted to make sure that the money wasn't refused.

That's why I'm not sure what difference this is supposed to make:

That lack of specificity has led to calls for tighter restrictions on the next wave of disbursements, approved by the Senate last week as President-elect Barack Obama pledged to "change the way this plan is implemented and keep faith with the American taxpayer." The incoming administration promises to create a system to track how the money is spent and place stronger limitations on executive pay.

Track it or not, the recipients will siphon as much out of the funding flood as they can. They'll look out toward the future and leverage unplanned windfalls to increase their competitive edge when circumstances change, buying up or elbowing out smaller competitors. And if the government is so perspicacious as to know precisely how banks ought to spend the money, then there's no need for the middle man.

Me, I say that the government should learn from my financial straits: Spending money that you don't have doesn't patch the floor in hard times; it digs a hole.

Qualifying the First Amendment?

Monique Chartier

When East Providence taxpayer Tom Riley spoke during the Public Comment segment of Tuesday's School Committee meeting, members of the NEA and other unions from around the state boo'ed and shouted him down. (It should be noted that Mr. Riley would, nevertheless, have carried on with his remarks but the School Committee determined that the volume and ferocity of this reaction required the termination of the meeting.) Asked later about Mr. Riley's rights of free speech, the East Providence teachers union asserted that a lack of accuracy on the part of the speaker was the reason for this coarse and abusive interruption.

Parenthetically, a list of the inaccuracies in Mr. Riley's comments would be appreciated. Does someone, anyone dispute, for example, that the selection process for layoffs, if they occur, will be "last hired, first fired" as asserted by Mr. Riley?

The First Amendment to the American Constitution provides the legal definition of free speech.

Congress shall make no law respecting an establishment of religion, or prohibiting the free exercise thereof; or abridging the freedom of speech, or of the press; or the right of the people peaceably to assemble, and to petition the Government for a redress of grievances.

So the teachers union proposes to amend, formally or informally, this definition to include accuracy of content?

If this is so, my concern is not for Mr. Riley. His comments Tuesday night would have easily passed such a new and more stringent standard. My concern would be for the speechifying ability of the teachers union. This would be endangered on two fronts as a result of the proposed new standard. Firstly, of course, the union has made statements which are erroneous to the point of absurdity. Secondly, however, this new standard would almost certain preclude what appears to be a communication staple of the East Providence teachers union: statements which include incomplete facts or facts presented out of context.

On that basis, other than pure statements of opinion and simple, unadorned requests, wouldn't the East Providence teachers union only silence itself with its proposed modification to the definition of free speech?

So Goes the Despicable Game

Justin Katz

Last June, I predicted that the midyear budget shortfall for the state of Rhode Island would be $364 million. As it turned out, I overshot by just $7 million (less than 2% off the mark) — the point being that, whether the cause was revenue, administrative overspending, or unreasonable savings and income expectations, the number was entirely predictable. All one had to do was look at last year's deficit, adjust the number for the pitiful production that was this year's budget, and shout out a number.

That's what makes the rhetoric of RI House Finance Committee Chairman Stephen Costantino (D, Providence) so stomach churning:

House Finance Committee Chairman Steven M. Costantino, considered the architect of the Assembly's budget plan, said he hadn't decided how to proceed. But he blasted the Carcieri administration for asking Rhode Island's struggling hospitals to help fix problems caused largely by overspending at state departments under the governor's control.

"The hospitals had nothing to do with that," Costantino said, before firing several pointed questions at Department of Human Services Director Gary Alexander, a member of Carcieri's Cabinet.

"What happens to uncompensated care in the state of Rhode Island?" asked a frustrated Costantino, adding that the cut "might be catastrophic for hospitals."

As one learns by clicking the second link of this post, two-thirds of the budget shortfall was related to revenue declines. And as we've all known for months, some significant percentage of the overspending is directly attributable to the statutory demands of the General Assembly. And so goes the game: Create a house of cards and then jump up and down pointing at the Republican governor when it falls down. That's why Mr. Carcieri's nicey-nice style will not suffice in this state.

Costantino may be genuinely frustrated that no miracle arose to save the financial gobbledygook that our state government calls budgeting, but he can't be half as frustrated as we who see clearly are that many of our fellow citizens will fall for his nonsense, whether out of apathy or because they've direct personal interest in the game's continuation.

The 51st State

Justin Katz

Apparently, Old Glory isn't adequate for some Obama supporters. See pictures here, here, and here.

One gets the feeling that, in a sense that has not been true for any American President thus far, it's his country, now. Or maybe time will wrap him in the modest trappings of actual humanity.


When Sin Trumps Conscience

Justin Katz

Rhode Island is one of seven states that would prefer that citizens with moral reservations about procreation-related procedures and drugs have fewer rights:

Seven states sued the federal government Thursday over a new rule that expands protections for doctors and other health care workers who refuse to participate in abortions and other medical procedures because of religious or moral objections.

Connecticut Attorney General Richard Blumenthal filed the lawsuit in federal court in Hartford on behalf of the states.

They claim the federal rule, issued by the Bush administration last month and set to take effect Tuesday, would trump state laws protecting women's access to birth control, reproductive health services and emergency contraception.

Blumenthal said the regulations "are flawed and defective" and would "unconstitutionally and unconscionably interfere with women's health care rights."

Note that the rule does not ban any procedures. It merely gives the individual provider the right to choose what he or she provides.

The end of rights and freedom will come proclaiming the sanctity of both.

January 17, 2009

At Least We're Not Alone

Marc Comtois

Connecticut has a familiar problem (h/t):

While the private sector was shedding millions of jobs in 2008 and government budgets were collapsing under the weight of waste, fraud and carved-in-stone personnel costs, the public sector had another banner year. Governments at all levels hired 164,100 new employees and were largely responsible for the addition of a further 96,600 jobs in education and 371,600 in health care. Now President-elect Obama wants to add 600,000 to the bloated federal payroll. Untold thousands more local, county and state employees will be needed to fill all the new and bigger public facilities built with stimulus cash. As it is, nearly 15 percent of the civilian work force draws government paychecks.

Lip service by public officials about fiscal austerity notwithstanding, governments and their public-employee unions seem to be approaching 2009 as if the recession is none of their concern. For example, recent negotiations produced teachers contracts that gave raises of 4.4 percent in Cheshire, 4 percent in Region 6, 3.75 percent in Region 14, 3 percent in Plymouth and 2.5 percent for Torrington. In Waterbury, the school board bestowed upon its administrators raises of nearly 10 percent over three years for the expressed purpose of beginning to undo everything the state oversight board did to rescue taxpayers from decades of governmental malfeasance and binding-arbitration abuse. Concessions will soften the impact of these raises some, but prevailing economic conditions minimally demand pay freezes and staff reductions.

In good times, employment ballooned beyond what could be sustained. The public sector is retracing its steps in search of equilibrium. Whither the public sector?

Misery loves company, eh?

Looking Before We Leap

Justin Katz

Unexplored concepts have been all the rage when it comes to Rhode Island's education system (and the money that supports it) of late. Consolidation! Funding formula! State-level contract! South Kingstown Superintendent Robert Hicks offers an important directive:

In the short term, we should subject any proposals to these questions: How do we know we'll get the results proposed? What are the obvious and not so obvious impacts? Is this the best we can do?

In the longer term, we should expand the discussion of a school funding formula to include how spending is controlled. This would make it easier to move into a new system. For example, Vermont's funding plan has penalties for exceeding the state's average per-pupil expenditure, a version of baseball's luxury tax. This forces efficiency on districts in a way that encourages and rewards innovation, exactly what we need.

Consolidation may lose more than it gains. A funding formula could be disastrous if it includes too many exponents. Frankly, I distrust our state's leadership so thoroughly — on good evidence — that I believe they should prove themselves in some manner before we embark on any consolidating changes. (Actually, I think most of them should be switched out prior to structural changes, but we work within the parameters that we're given.) In the meantime, we ought to be pushing decisions closer to the citizenry that must suffer for them.

Dutch Skaters, World Problems

Marc Comtois

In the Netherlands, the canals have frozen over for the first time in years and the Dutch are strapping on their skates and having a blast, albeit with a few bumps and bruises. But the politics are never far away, even in what you'd think would be a feel-good story. First, there's the environmental angle:

In the 19th century, when Hans Brinker, the hero of the novel in which he tries to win a pair of silver skates, coasted along Holland's ice, the canals froze almost every year. But water pollution and climate change have made this so rare that today a boy of 15, Brinker's age, may never have seen a frozen canal, or at least remember one. Until, that is, this year.
Then there is the cultural and political angle:
"For us, it's in our genes," said Gus Gustafsson, 68, a retired insurance executive, explaining why he and his wife had rushed out to buy new skates and take to the ice under a cloudless blue sky. "It was like a frenzy that came over people, including lots of kids, like my granddaughter, who is 5." With thousands of others, they skated northeast toward the cheese capital, Gouda, then toward Utrecht.

With an influx of immigrants, the country has been struggling to maintain what it considers its Dutch soul, and Gustafsson was one of many here who thought the skating experience enabled the Dutch to reconnect with their identity. "There were only Dutch people on the ice," he said. "I saw no people of Arab descent."

But Andre Bonthuis, who has been mayor in this town of 23,000 people for the past 20 years, said he had seen Indonesians and Moroccans, among other newcomers to the Netherlands, on the ice. "It's rather new for people from Morocco," he said. But he agreed that there was something very Dutch about canal skating, which is depicted in paintings by Dutch masters as early as the 17th century.

To be sure, a couple interesting asides. In particular, the second provides Americans a little glimpse into the mindset of an average European. But I'm just glad the Dutch were able to skate.

I've Been Everything You Want to Be, I'm the Cult of Personality

Justin Katz

Yeah, yeah. Go on and tell me that I'm a paranoid right-wing crank slipping into the forthcoming Republican version of Bush Derangement Syndrome, but this sort of thing — beginning even before inauguration — concerns me a great deal:

President-elect Barack Obama will need something akin to superpowers to handle the country's economic woes. Word is he's already hobnobbing with a famous superhero.

Obama is on the cover of a special edition (583) of the Amazing Spider-Man comic book. In the story, he and the famous wall-crawler team up after the Chameleon tries to crash the president's inaugural festivities. (There's another edition of the comic available, but Obama's not on the cover.)

The Providence Journal's Tatiana Pina exhibits none of that mythic journalistic cynicism or burning for inquiry that might have led to such questions as:

  • Have any other presidents ever received like treatment?
  • Are there any historical echoes for the treatment of a political leader as a superhero?

Including this latest, the Chicago Tribune has found nine comic books that involve the appearance of real presidents, and even within this tiny group, none compare. The Clintons had a cameo in Superman. Carter slipped onto the cover of "Superman vs. Muhammad Ali." JFK helped out Superman by posing as Clark Kent. On the Republican side, Nixon pondered losing the entire East Coast to toxic winds and was mocked by aliens. Reagan was savaged on a page of Batman. Marvel's The Punisher actually threatened the life of President Bush a couple of months after 9/11.

As to my second question, well, you all know the history.

Taxpayer Group's Message Spun

Justin Katz

The East Providence Taxpayer Association is getting a lot of well deserved press, lately. The dispute in their city is big news, and the EPTA is keeping a consistent and measured message out there. From today's Providence Journal:

Standing in the cold outside East Providence High School yesterday, a lone spokesman for the East Providence Taxpayer Association said public school teachers are being misinformed by their union in their ongoing dispute with the School Committee.

"We are pleading with our teachers not to let an out-of-touch leadership lead them off a cliff that perhaps will result in layoffs, missed payrolls or even the closing of the school system," William Murphy said. "Solidarity is little consolation at the bottom of the abyss."

In a statement, the association said one misconception is that the teachers were "attacked and victimized" by the School Committee when it decided earlier this month to reduce the teachers' salaries by nearly 5 percent and force the educators to pay 20 percent of their health insurance costs. The taxpayers group said the changes were "in no way motivated by the ill will toward teachers."

Of course, it's worth a moment's note that the Projo's headline for the report amounts to spin: "Taxpayer group says teachers misinformed." The group's tempered plea thus becomes an insult. Yesterday's Projo headline was "Taxpayer group criticizes teachers." Funny how the passive voice comes and goes. It would not have been grammatically unusual for the paper to have gone with "Teachers' Behavior Criticized."

The phrasing is a matter of interest within the belly of Alisha Pina's Friday report, as well:

The audience erupted in cheers when union President Valarie Lawson told the committee it should accept a recent arbitrator's recommendation for a new contract, which included a wage freeze this year and teachers' contributions to health care that would increase to 15 percent — 5 percent this year and 10 percent next year — within three years. She said the teachers were willing and simply want to get back to the business of teaching.

The rest of the meeting was dominated by boos and outbursts, most of which were directed at School Committee Chairman Anthony A. Carcieri.

Note that it was the entire audience — not the teachers and their unionist allies — who applauded the union president and that the union supporters are taken entirely out of the sentence about "boos and outbursts." Teachers of English and writing take note: These are some illustrative examples of bias's insertion into ostensibly neutral reportage.

RI Education Expenditures: Digging a Little Deeper

Marc Comtois

Prompted by Justin's analysis, I decided to take a closer look and compare the 2004 (PDF) and 2007 (PDF) statewide education expenditures (per student). First, as Justin noted:

[T]he statewide per-student spending on "instructional teachers" (as opposed to the broader "instruction") actually rose $880, from $5,490 to $6,370, or 16%. Both the size of the expenditure and its increase are greater than any other item — or category — on the list of education expenditures.
To better illustrate this, I teased the TEACHER category out of the INSTRUCTION altogether and included it as a separate item in the below illustration of the change in overall education spending (comparing 2004 to 2007).


Remember, the overall per pupil expenditure rose from $11,465 to $13,660 during this time--the pie got bigger, but the piece that went to the teacher's stayed relatively the same. But some pieces did get bigger. In particular, the INSTRUCTIONAL SUPPORT and OTHER category. Here is an illustration of where the changes occurred.


There was a "boom" in the "Therapists and Psychologists" category. Per pupil spending in 2004 was $403 (26.8% of the spending in the Inst. Support category). By 2007 it had jumped to $902 (40.3% of spending in the category). It's pure speculation, but the trend in this state to classify an increasing number of students as being "special needs" may be a causal factor. But like I said, that's speculation.


Here, there was an overall increase (as a percentage of total expenditures for the OTHER category) in both "Debt Service" and "Capital Projects." These categories are probably linked. Debt Service expenditures went from $98 per student to $270 while Capital Projects expenditures rose from $43 to $185. I'm guessing that these are basically infrastructure costs.

Yet, to put these numbers in perspective, remember that all spending increased around 20% in 3 years. And nearly 50% of all expenditures fall under one sub-category: teachers. It is understandable that teachers feel as if they are continually picked on when it comes time to cut costs. But the fact is the cost to employ is (usually) the largest line-item in any budget and, in the business world, one of the first places to go to cut costs. In the public sector, it has been the last. For too long, "cuts" have meant a reduction in the expected increase (cutting the COLA from 5% to 3%, for instance). Now, like it or not, real cuts are required. It's a paradigm shift that some simply aren't prepared for.

January 16, 2009

The Benefit of a Word

Justin Katz

It's may be a small thing, but it always bothers me when the word "benefit" is used to describe welfare-type payments and services, as in:

"This is to make the system better," [Governor Carcieri] said yesterday, noting that nursing home residents could more easily use Medicaid funds to live with family or friends under the new plan. But when asked about a separate proposal to limit the "benefit package" for thousands of low-income health-care recipients, Carcieri referred questions to a department head.

The connotation of one's "benefit package" at work seems to me to be that it is an extra benefit of doing something — namely, helping to move the company forward. In the case of insurance (not necessarily of the healthcare kind), one receives "benefits" for having invested in the plan.

If language matters, and I believe that it does, we ought to come up with a new term for receiving public largess, taken under penalty of legal repercussions, based purely on perceived need. Maybe "graft."

The Best Laid Plans

Justin Katz

They'll call it jealousy, the unionists, but I think a caller in to Jim Hummel on the Dan Yorke show yesterday put it more accurately: "Why do the union members think they're better than us?"

I really do wonder if they know what the average (thinking) private-sector worker hears when they say such things:

But those who spoke yesterday decried the "unfairness" of charging state employees and teachers among the highest pension contribution rates in the nation — 8.75 percent and 9.5 percent, respectively — and then withholding a benefit for which they paid. Talking about "property rights" and "life decisions" made in anticipation of annual pension increases, Vincent Santaniello, a lawyer and deputy executive director of the National Education Association of Rhode Island, laid the groundwork for a potential legal challenge.

Plainly put, the circumstances of life change. Nobody gets to take a job in their twenties and then kick back in comfort that their entire financial future is set. Even without cost of living adjustments (and especially with a higher minimum retirement age), considering their pay, their benefits, and their free time, there is no reason that teachers and other public employees shouldn't be able to position themselves extremely well for retirement.

Rhode Island Federation of Teachers & Health Professionals President Marcia Reback speaks of "a permanent subclass of senior citizens who will be in poverty with no hedge against inflation." Yeah, right. Tell that to those of us who work our fingers to the bone yet are always one bill behind because our own taxes and the toxic environment that redirects opportunity away from our state prevent us from advancing in absolute terms, let alone against inflation.

Accommodation Upon Cashing Out

Justin Katz

I might be missing something, but this seems to be becoming a bigger deal than necessary:

But after hearing mayors, school administrators and union leaders warn of potential chaos 10 weeks before the end of the school year, Gallogly said she consulted with the state's actuarial consultant yesterday and was told the state could move the deadline for employees to retire to any point prior to the June 30 end of the fiscal year, and still book this year’s $95-million state and local share of the savings from this long-term reduction in the state's unfunded liability.

If the savings are in retirement payments, couldn't the state just stipulate that retirees finish out the year?

The Union Executive's Projection

Justin Katz

This is classic Crowley:

Repeat the lie. Repeat the lie. Repeat the lie. No matter how wrong, no matter how damaging. Repeat the lie. This must be posted in the Projo editorial room somewhere:

The lie.

Crowley's first step to this particular platform was finding a bit of data that looks, in the light of a flickering 20-watt bulb, as if it might support the contrarian notion that taxpayers are actually moving in to Rhode Island. He then ignored arguments that his finding was, at best, incomplete. And before you know it, he's accusing of outright lies those who dare to restate the common (and accurate) knowledge that taxpayers (and people, too) are leaving the state.

You've heard the old home remedy that faking a mental illness means you don't really have it? Well, Pat's version is to point the finger at his opposition to distract from his own offensives.

Just the other day, when asked what "the teachers" would say to a particular argument, I referred to a year-old letter from Mr. Crowley claiming that "the cost of teaching has risen slower than overall inflation." His conclusion was that "it isn't teachers and their exorbitant salaries driving the costs" of local education. I pointed out at the time that, when one teased out the component of "instructional expenditures" that actually goes to teachers, it increased well over inflation, and at the expense of such other items as technology and instructional materials. There's something perverse about leveraging the decline in spending on an item from which teachers' ever-growing remuneration has been draining funds to suggest that contracts haven't been shifting in their favor.

Well, here he goes again:

According to the Rhode Island Department of Education, we are spending less and less of our education budgets on teachers and instruction over the last several years. For example, in 2004, 56.7% of statewide spending on education went to classroom instruction. In 2007, that number fell to only 51.7% of statewide spending, a drop of 5%. ...

What does that mean? Well, it means that spending on classroom teachers, their salaries and benefits, are not the things that are driving the cost of education. It also means that the items contained in collective bargaining are not the cost drivers. In fact, spending on teachers is not even keeping up with inflation. In 2004, total statewide spending on education was $1,795,090,933. By 2007, the number had risen 14% to $2,088,669,861. But instructional spending rose from $1,018,276,109 to $1,079,576,386, a rise of only 6%.

In actuality, from 2004 (PDF) to 2007 (PDF), the statewide per-student spending on "instructional teachers" (as opposed to the broader "instruction") actually rose $880, from $5,490 to $6,370, or 16%. Both the size of the expenditure and its increase are greater than any other item — or category — on the list of education expenditures.

So, as Crowley complains that spending on instruction hasn't risen in keeping with the rest of education spending, he ignores the fact that teachers claim an increasing percentage of that pie:

A broader investigation of expenditure data would make for a worthwhile discussion, if anybody wishes actually to engage in it.

January 15, 2009

All-Government Strategery

Justin Katz

A Sakonnet Times article (that doesn't appear to be online) reports on a meeting of "all elected town and school officials and some top administrators" in Tiverton to discuss budget woes. (A van breakdown prevented me from getting there.) Speaking to the reduction in state aid, Town Administrator James Goncalo states, "The municipal side cut is at least $600,000, so we're looking at ways to cut $100,000 per month."

That looks like an insurmountable number, but in context of monthly spending on the municipal side of town government of about $1,370,000, we're talking roughly 7%. For some additional perspective, the town spends over a quarter-million dollars per month on debt service alone.

What caught my eye in the article, however, was the closing quotation from this paragraph:

"The school department is limited in what it can do to cut its budget," said Mr. Rearick. A mandatory minimum retirement age of 59, and other pension and health benefit recommendations affecting retirees, could precipitate the departure of numbers of town and educational employees prior to April 1 — "people walking out the door April 1st. They just leave," said Mr. Rearick.

Clearly, such folks would be making a financial decision as employees of the town. That's fine; everybody should do what they believe to be best. What it serves to emphasize, though, is that those who govern the town should feel free to make rational financial decisions, as well, behaving above all as employers acting in the interests of their constituents.

Hummel and the Union Trio

Justin Katz

Jim Hummel, filling in for Dan Yorke, has had three unionists on the program since 3:00, and as I've pulled up flooring and cleaned my jobsite, I've been itching to make three points:

1. Regarding the teachers'/union's behavior at the latest School Committee meeting, NEA lawyer John Liedecker pointed out that the police had said, on the radio, that at no point did the evening approach a riot. Is that the standard, now? Appropriate behavior on one side of the line and rioting on the other?

2. Local East Providence union President Valerie Lawson stated that all they want is for the School Committee to return to the negotiating table and try to get the two sides' numbers a little closer. As we've also experienced in Tiverton, this ignores the reality of what the School Committees have begun to do — namely, to tell the teachers exactly how much there is available and to move from there. In other words, there is no hidden pile of gold. Either the teachers are refusing to believe reality, or they are, in effect, demanding that the districts cut broad swaths of other spending, even though teacher pay and benefits have been draining other areas of expenditure for years.

3. I want to give a quick tip of the hat to the blogging revolution. The union trio had been claiming that the heckling was all about School Committee Chairman Anthony Carcieri's microphone misuse. When Jim Hummel played my clip of the teachers' shouting down taxpayer Tom Riley, Ms. Lawson could only stumble through a response until Mr. Liedecker jumped in and smoothly changed the subject.

Beware entrenched powers and special interests: Bloggers are out there!

Tom Ward's COLA Proposal

Carroll Andrew Morse

Valley Breeze publisher Tom Ward offers a proposal for modifying cost-of-living pension increases that's softer than a total freeze

What is the better way to handle COLAs and save money? Follow the lead of our surrounding states, that's how.

In Massachusetts, all state employees get a 3 percent raise on the first $12,000 of their pensions, and no more. What if we did this in Rhode Island (with $12,000 or, I would suggest, an even larger figure) and extend it to both current and future retirees?

It's a question I posed to state General Treasurer Frank Caprio last week when he stopped in for a visit to this newspaper.

"Is it fair," I asked, "for a recently retired Woonsocket superintendent of schools to receive a $350 per month raise (on a $140,000 annual pension), every year, forever, while teachers who have been in the classroom 25 years get no COLAs when they retire?" We agreed the correct answer was "No."

Groundwork for Political Cover

Justin Katz

I'm not saying that the governor's supplemental budget is perfect, nor am I claiming evidence of his staff's diligence with regard to the items included therein, but this has the sound of political cover being draped over intentions to shift the onus of the budget fix and not to make necessary changes:

"This is extremely grim," [House Finance Committee Chairman Steven M.] Costantino said. "We are set toward a catastrophe unless we act quickly. It's also grim in the fact that many of the items in this budget are one-time fixes and gimmicks that are not tied to good budgeting practices, as well as some actions that realistically may not meet the timetable as set forth in the budget." ...

[House Fiscal Adviser Michael] O'Keefe warned the legislators to pay close attention to details and be wary of proposed cuts that may not have been properly scrutinized to ensure the promised savings. "There's a heavy reliance on items that the necessary research appears not to have been done," he told the committee.

It's a bit much for members of the General Assembly to begin complaining about one-time fixes and gimmicks now. It was clear at the time that they passed it that the current budget was no different — probably worse — than the governor's supplemental in this regard. Moreover, some of the changes proposed by the governor are structural, long-term repairs as much as they are short-term saving measures.

Their good humor was short-lived. Moving forward, lawmakers will have little room — and little time — to revise this budget and still achieve the savings they need to close the deficit.

This is true, but it's fair to ask: Where, then, have they been? If it's a point of criticism that the governor's plan requires vetting and the General Assembly lacks the time, then why didn't it convene sooner?

I have my concerns about the supplemental budget, and it worries me that the House fiscal adviser is even able to make claims about a lack of substantiation, but as I've already said, the governor must make the General Assembly own any changes to the plan. His mantra must become, "This is not the budget that I submitted."

Above everything else, Rhode Island needs the political game and the shifting of blame to cease. We need stark lines around decisions and their makers.

The Locus of Disruption

Justin Katz

Andrew's call in to the Matt Allen show, last night, turned into a longer form interview about the East Providence School Committee meeting. Stream by clicking here, or download it.

To the conversation about Anthony Carcieri's microphone volume (or lack thereof), I'd add my impression that Carcieri fully anticipated a disruptive atmosphere and was focused on moving through the agenda, without expectation that the audience would be following along — or would be able to do so, given audience noise. Consequently, he didn't bother much ensuring audibility beyond the dais.

That said, from my limited experience in Tiverton, the tone that the union set in East Providence was pretty standard for negotiation-season school committee meetings. The "can't hear you" heckles are a mainstay — anything to rattle the small-time public officials.

Indeed, if you listen to the second snip of audio from the meeting, somebody shouted that very phrase — amid a drown-out wave of boos — almost before Carcieri'd said a single word.

January 14, 2009

A Disconnect About Motive and Cause

Monique Chartier

East Providence is looking at budget deficits of over $4m per year for 2008 and 2009 and some scary tax increases if spending on the largest portion of their budget - personnel costs - is not brought into line.

This fact seems inexplicably missing from too many statements by the teachers union. These include but are not limited to:

They've set this thing up, they've run this city into the ground just with the sole purpose of trying to knock down this union.


They intentionally cut their budget short. There's a 1% increase in the school budget this year. They knew that wasn't enough.

Does the teachers union honestly think that the city of East Providence has not hit a financial wall? Or could it be that something must be said to justify the demand for ever-increasing compensation even in a bad economy, not to mention the need to justify the unionization of a group of professionals (and the attendant union dues that arise out of that relationship) and nothing resembling a fact-based rationale could be found?

In point of fact, East Providence, like many other municipalities (as well as the state), is facing a very difficult fiscal situation, mostly as the result, it should be noted, of the irresponsible budgeting practices of past School Committees and City Councils. No one on the present committee or council is the least bit happy about asking municipal employees to take a reduction in compensation. Not one bit.

While, to reiterate, the current budget crunch is mostly the doing of prior School Committees and City Councils, the teachers union only exacerbates a difficult situation, thereby mis-serving its membership, by failing to convey important facts and misinterpreting the goals of the School Committee and City Council.

Union Life Cycle and Expectations

Justin Katz

Jim Hummel made the point, while filling in for Dan Yorke today, that teacher union contracts are the product of years — decades — of cumulative negotiations. Compromise on X for reason A, one year, and expect to make it up a few years down the road. Consequently, a rollback (his point goes), as appears likely in East Providence, throws some sort of delicate balance off kilter for the teachers.

The problem with this approach is that unions have no employment life cycle. They latch on to the district and remain there, in theory, as long as the schools exist. An individual employee in the private sector will see his or her remuneration go up and down, shifting from this to that, generally increasing over a career (most significantly because of promotions, rather than raises), and then retire — probably having shifted companies in the interim. Eventually, the increased cost of that employee's equity with the company goes away.

The way the unions work their contract is to shoot for pay increases; if they can't get that, they go for benefit increases; if they can't get that, they go for perks; if they can't get that, they seek to shift work environment and employment terms. But unions don't retire, and they don't shift to another district to chase opportunity.

That is to say that the district never gets relief from those cumulative negotiations. As they mount, there's only so much that the town can pay for education, and there are only so many work and management rules that it can afford to compromise before the cost is seen in the quality of students' education. As they struggle to maintain the rule that teachers' employment packages never diminish, they begin to cut facilities and program spending.

Hummel also mentioned that every teacher whom he has asked about the union's behavior at the East Providence School Committee meeting last night has seen nothing wrong with it. I'd suggest that the reason for this egregious blind spot is that the union organization has invested many years of effort persuading teachers that "this is the way these things are done." They think that all negotiation proceedings occur this way and that, otherwise, "the school committee will walk all over us." (These aren't direct quotes from anybody in particular, by the way.)

I guess the long and short of it is that teachers ought to be professionals, and public sector professionals oughtn't be unionized.

East Providence Schools: The Fiscal Problems They Face

Marc Comtois

Anchor Rising has received the following:

The East Providence School Committee is providing 2 examples of the financial avalanche facing our entire community.

Attached is legal action by the Northern RI Collaborative seeking past due payment of $563,214.30 for tuition payments for our special-needs students.

It is irrational that the teachers' union chooses to ignore the financial crisis facing its own community. This is apparent given their behavior at our school committee meeting tonight.

Here is a copy of the bill from the NRIC (PDF). Additionally, here is a bill from the RI Interscholastic League with charges totaling $6,496 (PDF).

Less Stable than Expected and Morally Bankrupt

Justin Katz

Well, it appears that the house doesn't always win:

The Mohegan Sun casino is slashing the salaries of its nearly 10,000 employees, after seeing slot revenues drop last year for the first time since it opened 13 years ago.

In a statement, the casino said top executives will lose 10 percent of their wages; middle management will give up 7.5 percent of income and hourly employees will see their paychecks shrink by 4 percent.

Bonuses will also be eliminated, as well as contributions to employee retirement accounts, one of the benefits Mohegan Sun has cited in boasting of its "reputation as one of the premier employers in the region."

What's worse, in my opinion, is the light that the following shines on the general motivation to invest in gambling, namely the stability of the revenue stream:

The combination of falling home values, rising unemployment and turmoil on Wall Street have helped disprove the conventional wisdom that gamblers will keep gambling even in times of economic troubles.

In recent months, Mohegan Sun has seen fewer visitors, and its more loyal customers are making shorter visits, wagering less money and cutting back on their eating and drinking. "The market and the economy have been deteriorating, and it's made us take steps to offset that," Mohegan Sun’s chief executive officer, Mitchell Etess, said in an interview yesterday. "Everyone always thought casinos would be more resistant to economic recessions. We're beyond a recession here."

In other words, one of the attractions of the business is the expectation that people will continue gambling their money away even when they can least afford it. Does that sound like the sort of enterprise on which our government ought to be heavily reliant?

Taking the Deliberative Out of Democracy

Carroll Andrew Morse

Let's recap the events that helped bring last night's East Providence school committee meeting to an abrupt end.

The third speaker of the public comment period was East Providence teacher Mary Texeria. As Justin alluded to in the previous post, Ms. Texeria made a tough but fair statement saying that she would be willing to accept a pay freeze for as long as five years, if the school committee would "admit" -- her word -- to all of the factors that have contributed to the East Providence budget crisis. The factors she mentioned were that "the school committee was never supported by the city council", "too many state mandates", "the collapse of our economy" and "mismanagement over a 10 year period". (Start at 0:49 here).

Then East Providence resident Tom Riley took his turn. He also discussed the salary situation, stating that he would prefer to see an across-the-board salary reduction that would preserve the existing number of teacher positions, rather than cuts that result in junior teachers being laid off. At that point, somebody from the union side demanded that Mr. Riley be prevented from commenting on this subject, despite the fact that Mr. Riley's comments were no more further afield from the subject of the meeting than Ms. Texeria's.

And the teachers clapped.

In response to a demand that a citizen be silenced, the teachers clapped, eventually loud enough to prevent Mr. Riley from being heard. (Interruption of Mr. Riley is constant, but start at about 1:50 here to hear the end).

East Providence teachers union President Valerie Lawson later went on WJAR-TV (NBC 10) with Dan Jaehnig to say that "we live in a democracy, everybody's entitled to free speech". Apparently to Ms. Lawson, a democracy is a place where only union members have the freedom to speak on issues in public forums. This kind of disdain for citizens, taxpayers and democracy is why many members of the general public have ultimately come to take a dim view of teacher unions.

We have to do better than this if we expect self-government to survive.

Not Here... Yet

Justin Katz

Via Jay Nordlinger comes what we can only hope is not a vision of Rhode Island's future:

French teachers hurled shoes and other objects at police Monday to protest President Nicolas Sarkozy's high school reforms, prompting police to respond with tear gas.

France's leading teachers' unions demonstrated in the western city of Saint-Lo at a cultural center before Sarkozy gave a New Year's address to education officials. Protesters and police exchanged blows, and one store window was smashed. No arrests or injuries were immediately reported.

Major unions refused to attend the president's speech because they oppose the government's education reforms.

Sarkozy's government wants to modernize the education system to make French students better prepared for the job market. But the government is also seeking to cut costs and bureaucracy across several sectors. The education reform includes changes to high school curricula but also job cuts among administrators and teachers' aides.

Where teachers behave thus, teenagers racking up hundred-million-dollars in riot damages cannot be far behind. Nordlinger opens up his Impromptus column (which is structured like a blog) with an appropriate musing:

It seems to me that the Left has won: utterly and decisively. What I mean is, the Saturday Night Live, Jon Stewart, Bill Maher mentality has prevailed. They decide what a person's image is, and those images stick. They are the ones who say that Cheney's a monster, W.'s stupid, and Palin's a bimbo. And the country, apparently, follows. ...

What are the shaping institutions of American life? The news media. Entertainment television. The movies. Popular music. The schools, K through grad school. In whose hands are those institutions? In what areas do conservatives predominate? Country music, NASCAR, some churches? (Talk radio too, I suppose — no wonder so many on the left want to shut it down.)

As to Jay's question about areas in which conservatives "predominate," I'd offer the small — but important — addition of comprehending reality.

The Sound of the Beginning of the End

Justin Katz

The following are some audio clips from the East Providence School Committee meeting. Keep in mind, while listening, that the sound isn't entirely representative. For one thing, I was sitting near the taxpayer group, so they might be overrepresented in the general sound level (although still greatly outnumbered).

  • School Committee Chairman Anthony Carcieri makes his appearance to booing: stream, download
  • The union sets the tone right from Mr. Carcieri's very first words (and, yes, that's me shouting "grow up" — keep in mind that I'd already been subjected to a half-hour of union slogan chanting and screams): stream, download
  • The teachers cheer that some of them have actually done (gasp!) extracurricular work: stream, download
  • The teachers cheer that they can blame poor performance on "facilities" (nevermind that keeping up with teacher contracts has been bleeding other segments of school budgets for years): stream, download
  • A moment of heckling, including the call of "Scared?": stream, download
  • Just a snippet of the tone that continued, with a gradual escalation, throughout the meeting: stream, download
  • The teachers find the phrase "anti-bullying" humorous: stream, download
  • The teachers find the quip "outdoor voice" humorous: stream, download
  • Anthony Carcieri attempts to lay down the ground rules for public comment, and local union leader Valerie Lawson speechifies: stream, download
  • East Providence teacher Mary Texeira offers a reasonable statement — although she probably goes off the union message a bit when she states that she wouldn't mind a five-year pay freeze if the school committee would lay out the reasons that it's necessary: stream, download
  • Taxpayer Tom Riley takes the mike and faces down the hecklers — inspiring the single most silent moment of the night when he suggests that younger teachers will lose their jobs if the union doesn't let the district spread the costs across their pay packages — but the devolution of the meeting leads the school committee (almost inaudibly) to adjourn: stream, download

Images from Tuesday's School Committee Meeting

Monique Chartier

[Prior to the commencement of the meeting]


At the entrance to the High School Auditorium


As media cameras roll, cheers, yelling and chants of "teachers, teachers".


And down in front, two or three merry bars of Solidarity Forever.

January 13, 2009

What We're Up Against

Justin Katz

So parking has already spilled over to the supermarket parking lot across the street, and it was clear from conversation that the women standing at the crosswalk with me were teachers from another district. As we crossed, the policeman directing traffic told them to "be loud — my wife is a teacher." (There's a six-figure household.)

Barely had I sat down when the unionist who had complained to me in the men's room of driving down from Boston for a recent Tiverton School Committee meeting accosted me, suggesting that I "get a real job — you loser." I tried to be friendly, but he didn't seem interested. Subsequently, he walked around pointing me out to the other side.

Fun, fun.


At least there are some good guys here, some wearing t-shirts that read: "Teachers and Union Reps BIG Difference."

ADDENDUM (7:36 p.m.):

The teachers are screaming like kids at a rock concert for the benefit of a television camera. This should be required viewing for all citizens of the state.

ADDENDUM 7:39 p.m.:

It's sort of that old comic book cliché of an unstoppable force meeting an immovable object, isn't it? There simply is no money, and yet, one out of six Rhode Islanders is being prodded by union organizations to get out and demonstrate against necessary adjustments.

Do they not understand what is happening, or do they not care? (Or does their union organization strive to keep them misinformed and maleable?)

ADDENDUM 7:44 p.m.:

I saw Pat Crowley strolling up the aisle along which I'm sitting, and I prepared myself to shake his hand, should we make eye contact. A friendly quip came to mind for the moment after skin contact: "See, reality didn't explode." Instead, he kept his shaking hand in his pocket and handed me a business card with the following quotation from a Boston Globe letter:

Why are we the pigs? The public employees I know are social workers who care for abused and neglected children. Or they work with mentally ill and mentally retarded adults and adolescents. They find homes for the homeless. They keep the roads repaired and clean. They open and close the bridges. They run the 911 emergency system. They teach our children. They keep the city and state hospital systems working. They run state prisons. Public employees are police officers and firefighters. Public employees help keep you healthy and safe.

But nobody disputes any of this. We who wish reform have a variety of roles that benefit society. Were I in a poetic mood, I'd list some of the more sympathetic among private sector jobs, but you can certainly come up with them yourself. Rhode Island simply cannot afford to keep leading with its heart, because those people who do all those wonderful things — along with coaxing the system to pad their wallets — are pulling the entire state into the quicksand.

ADDENDUM 7:56 p.m.:

True to the usual maturity of these audiences, the teachers booed as the school committee walked toward the stage — one of them a young lady who's probably a student.

ADDENDUM 8:02 p.m.:

Vicious "boos" as Anthony Carcieri walks in room. Unbelievable. And intended to intimidate.

ADDENDUM 8:05 p.m.:

Boos and heckling as soon as Committee Chairman Carcieri tried to speak. I cannot believe adults think it's appropriate to behave like this.

ADDENDUM 8:08 p.m.:

Even the Pledge of Allegiance became a bit of protest theater in their hands.

ADDENDUM 8:16p.m.:

Despite quips and harangues from the audience, the school committee is just moving forward with the agenda.

Pay attention, teachers: this is what courage looks like.

ADDENDUM 8:19p.m.:

As a few teachers continue to shout out, and the rejoinders from the crowd for them to "shut up" increase, I do wonder whether any of the teachers are embarassed that they are asked to join these mobs. Or did those teachers decline to come out tonight?

ADDENDUM 8:23p.m.:

Mr. Carcieri has skipped an item or two on the agenda, requiring others at the table to correct him. There have been a couple of snickers from the crowd, but one really must appreciate the anxiety that his position engenders, just now — even those who disagree, I would think.

ADDENDUM 8:31 p.m.:

During a review of a district-wide analysis, an administrator mentioned a couple of instances in which teachers are volunteering time and working after hours. The teachers cheered, as well they should.

They're also cheering as she describes that some deficiencies aren't the teachers, but the supplies and tools that the district provides. As I'll be pointing out in a graph in the near future, a significant reason for that development is that more and more of RI districts' money has been going to pay teachers' salaries and benefits.

ADDENDUM 8:36p.m.:

Some heckles to "speak up" and "use the microphone." A woman called out, "Scared?" If she were closer to me, I might have called out in return: "Wouldn't you be."

Perhaps the most astonishing thing, coming from teachers, is the utter lack of empathy that they exhibit. I imagine they do better with the students, but it's disconcerting to realize that they believe school committee members to be The Enemy, and therefore undeserving of some basic respect.

ADDENDUM 8:40 p.m.:

A mention of an anti-bullying program brought what I'd describe as cackles from the audience. It's like a movie set in Medieval times.

Now their screaming "out door voice." Really.

ADDENDUM 8:43 p.m.:

It's a good thing that we've gotten to the public comment section. I don't think the audience could stand to sit still much longer.

ADDENDUM 8:46 p.m.:

Local union head Valerie Lawson wants them to accept the arbitration. "Let the teachers get back to teaching the students."

You mean they're not?

ADDENDUM 8:49 p.m.:

Comments from the crowd around me suggest that the teachers intend to run the clock.

One just gave a reasonable speech and said that she "has no problem not getting a raise for the next five years" if the school would admit the problems.

The next speaker got up and introduced himself as a taxpayer. He was jeered.

ADDENDUM 8:53 p.m.:

The union is declaring "point of order" that the speaker is bringing up issues that aren't on the agenda. Heckle. Heckle. Jeer. Jeer.

But this isn't an agenda item. It's just a statement from an interested member of the public.

The school committee declared that the meeting is getting out of hand and called it a night.

ADDENDUM 8:58 p.m.:

Very loud boos as the school committee prepares to leave.

Any teachers who read this, I implore you: Take a moment to consider why it is reasonable for these town officials to be nervous. Think of the environment that you create at these meetings — not just this one, but every big and small town in the state. Is this who you want to be?

Breaking Location

Justin Katz

I just received word that the East Providence School Committee meeting has been moved to the high school at 2000 Pawtucket Ave.

A Global Riot

Justin Katz

Although he offers an historical contextualization of the rioting in Greece, Robert Kaplan worries that they may be an indication of the century to come:

The protests of today are not about America; they are about the legitimacy of a government that has been in power for four years without achieving much. With the global recession bearing down on Greece, the country is in desperate need of difficult reforms and privatization measures to help it in the Darwinian struggle to attract foreign investment, upon which much economic growth is dependent. The problem is that despite the probability of new elections, Greece seems destined to suffer through a period of weak governments, which will lack the political capital to do what's necessary in the way of change. The conservative New Democracy party has been neutered by the riots, even as the left-of-center Panhellenic Socialist Union (PASOK) is compromised by close ties to the very labor unions who would have to be challenged if meaningful reform is to take place. Of course, PASOK could carry out the reforms, in the manner of a right-wing President Richard Nixon going to China, but it could only conceivably do so with a strong majority in parliament, which it will probably not get. What's more likely is increased influence by smaller and more radical parties, like the communists. Thus, Greece could dither and end up politically paralyzed.

It's tempting to dismiss this as a purely Greek affair that carries little significance to the outside world. But the global economic crisis will take different forms in different places in the way that it ignites political unrest. Yes, youth alienation in Greece is influenced by a particular local history that I've very briefly outlined here. But it is also influenced by sweeping international trends of uneven development, in which the uncontrolled surges and declines of capitalism have left haves and bitter have-nots, who, in Europe, often tend to be young people. And these young people now have the ability to instantaneously organize themselves through text messages and other new media, without waiting passively to be informed by traditional newspapers and television. Technology has empowered the crowd—or the mob if you will.

I'd raise a point that I've enunciated before, and that is visible in Kaplan's suggestion that union reform is necessary: It isn't untrammeled capitalism that has wrought modern economic society; it's that infamous Third Way approach to putting a capitalist engine into a socialistic vehicle.

Correction and East Providence

Justin Katz

Two notes:

  1. Apparently, I was incorrect about town councils' having the authority to reduce tangible propert taxes to 0%. According to John, in the comments, the town is limited in the degree to which it can make one class of tax higher (or lower) than another. (That does not disallow the 25-year exemption.) I should note, however, that, also in the comments, Representative John Loughlin has pledged to introduce legislation granting towns more control over such taxes.
  2. I'll be at the East Providence School Committee meeting this evening. If you're near a computer after 7:30 p.m., check in from time to time. If you're also at the event (and you can find me) say "hello."

Panel says Governor's Immigration "Order created fear"

Marc Comtois

So, the Immigration Panel has found that:

Governor Carcieri’s executive order on illegal immigration has created such fear throughout Rhode Island that...he [should] make a “well-publicized clarifying statement” to explain what the order does and doesn’t do.
Please. The ProJo "advoticle" (advocacy piece within a news article) is full of anecdotal 'fear' stories of immigrants hiding in basements and avoiding travel in Rhode Island. No word on whether the Panel's members actually worked to clarify any of these misconceptions. And Warwick Police Chief Stephen McCartney had an interesting response to all of the advocates' sturm und drang:
Warwick Police Chief Stephen McCartney said it would help if the police were allowed to attend some of the meetings with the immigrant community, to hear the complaints firsthand. The police members of the panel did not attend the five meetings held in Providence and Newport.
Legal immigrants have nothing to fear from law enforcement.

Small Strands of the RI Web of Interests

Justin Katz

Simply because it represented an unanticipated expenditure during a time of extremely tight budgets — indeed, when the town council is pondering a "token" reduction in its own pay totaling $2,520 — I made note of the Tiverton Town Council's decision to make $900 available to municipal officials to attend a Grow Smart RI workshop on "making good land-use decisions." Now, I don't want to make a big deal of such a (relatively) small expenditure, and the council did pass the measure unanimously, but there's a curious point to consider.

Town Solicitor Andrew Teitz made the suggestion during his "announcements, comments and questions" section at the tail end of the meeting, and ex-president Louise Durfee was the first to ask questions about the cost. She initially asked whether $90 was to cover all attendees and then made a joke indicating some surprise at the high expense. Yet, when it came down to it, she was the one who made the motion to release almost a thousand dollars.

She's also listed as a director emeritus of Grow Smart and was an active member of the board of directors until a few years ago.

Like I said: It's a small thing, but we've all heard the phrase "death by a thousand paper cuts." It's a torturous death, indeed, when experienced amid the salt of layoffs, foreclosures, and general financial hardship. To a carpenter who just found himself $50 short of the amount needed to avoid late fees on his mortgage (which, incidentally, would have been affordable had his property taxes not gone up so much this year), $900 isn't such a token.

The Intangibles of Rhode Island

Justin Katz

With taxpayers — especially business taxpayers — beginning to get uppity, one often hears the invocation of Rhode Island's Political Knot. Nothing objectionable is anybody's fault; it's all a natural construct that can't be changed... at least by the person to whom one would turn for relief.

Take the "tangible tax." I know of at least one local business owner who complained that the "tangible property tax" collected by the town was doing palpable harm to his business and whom the Tiverton Tax Assessor informed that the town has no choice: State law compels him to assess and collect the tax. Presumably, he's referring to Rhode Island General Law 44-3-1:

Real and personal property subject to taxation. – All real property in the state, and all personal property belonging to the inhabitants of the state, whether individuals, partnerships or corporations, and all tangible personal property located in the state belonging to nonresidents, are liable to taxation unless otherwise specially provided.

The rest of Chapter 44-3 is essentially a list of exemptions, but I see no provision requiring "specially provided" to be an action of the General Assembly. Indeed, turning to 44-3-3.1:

Exemption of office equipment used for manufacturing or commercial purposes. – (a) The city or town council of any municipality may by ordinance wholly or partially exempt from taxation for a period of up to twenty-five (25) years any items of office equipment, which include, but are not limited to, computers, telephone equipment, and any other items of personal property used in an office and/or any leasehold improvements which are not exempt and are used for manufacturing or commercial purposes and may by ordinance establish the procedures for taxpayers to avail themselves of the benefit of any exemption permitted under this section.

In other words, the town could opt to gut the tangible property tax on business if it chose to do so. Note, also, that the law places no requirements or limits on the rate. My understanding is that a town or city could set its tangible property tax rate to 0%, effectively eliminating it.

Now that we've cleared up the confusion, town councils across Rhode Island can feel free embark on business-saving changes to local tax codes.


According John, in the comments, RI law prevents a town from charging a greater than 50% higher rate for any class of tax than any other, so zeroing one rate would require zeroing them all.

That factor does not appear to affect the possibility of exempting businesses from tangible property taxes for a period of 25 years.

January 12, 2009

Re: Making Indoor Prostitution Illegal

Monique Chartier

... or "Gosh, we would make it illegal but ..."

The reason given in the past by General Assembly leadership for its failure to close out the technicality that makes prostitution legal indoors is that the consequences of doing so would fall disproportionately on women - i.e., the prostitutes.

There is an easy solution to this dilemma. Make it illegal to purchase such services but not to sell them.

Understand that I am not saying that this would be fair. It would, however, accomplish both of the General Assembly's purported goals: outlawing prostitution while holding women legally harmless.

Oh, It Was a Joke

Justin Katz

Len Lardaro was on Dan Yorke's show early this afternoon to talk about the op-ed that I mentioned this morning, and he declared that his suggestion of raising the state's sales tax to 8% was more or less a joke to get a rise out of people. Frankly, I don't know Professor Lardaro, but my BS detector was screaming.

Some listeners called in and informed Dan that Lardaro had also been on Buddy Cianci's show and hadn't said anything about a public put on.

Back into the Swing of Day to Day

Justin Katz

With the new year and the new dynamic in the town council, I thought I'd best resume the habit of attending all meetings — exuding my apparently intimidating presence.

At the moment, there's one of those typical town-level debates about development issues. Somebody wants to develop and needs some sort of concession from the town concerning a road of somewhat ambiguous ownership, and old grievances come to the town microphone. I do wonder whether this is a practice that diminishes as towns move from quasirural to suburban, decreasing the ambiguities and limiting additional development.


TCC member Joe Souza just pointed out that, if the developer is asking the town to cede some land, then the town ought to get some money for it. A reasonable point, although I don't know the amounts involved.


On the other hand, there are road improvements and such involved in the package. As with much else, these "negotiations" could stand to be more explicit about what is given and what is exchanged, for lack of a better word.


TCC member and councillor Jay Lambert just suggested that the town ease the burden on businesses and save processing expenses by enabling various licenses and such to be held for longer than one year terms. Solicitor Teitz explained, first, that the year term is set by the state and, anyway, that it's convenient to have businesses come before the council every year just in case there are any issues for which the town doesn't want to (or can't) go through the appropriate due processes.

ADDENDUM 8:26p.m.:

Jay Lambert just called for the town council to take the lead on reductions by cutting their $2,400 stipend by 15% or 20%. Cecil Leonard put forward a motion for 15%.

Ex-Council President Louise Durfee expressed concerns that future councils won't be able to attract the poorer of Tiverton's "diverse" residents without the full stipend.

Leonard pointed out that his motion was specifically a one-year action, but Durfee stated that the council can't, in the future, raise its own salaries back.

Joanne Arruda, Don Bollin, and Hannibal Costa all suggested that the action be made a personal option for individual councillors.

Lambert's arguing that the people who'll see their salaries cut and so forth won't be able to opt for it.

Durfee wants to wait and see what the finances actually do.

ADDENDUM 8:34 p.m.:

Durfee and Joanne Arruda are both making the argument that the stipend allows them to give to charity. Hmm.

ADDENDUM 8:38 p.m.:

With that motion tabled until next meeting, Lambert is suggesting the compilation of potential projects to put forward for our share of the magic Obama money.

ADDENDUM 8:41 p.m.:

One town official, in detailing "shovel ready" projects, noted that nobody knows the form of stimulus (grants, loans, a combination). But hey, it might be that Obama's going to hook me up to a sewage line!

I ask again: Why hasn't anybody else ever thought of dishing out money to give everybody in the nation somethin' fer nuthin'?

ADDENDUM 8:53 p.m.:

Now Lambert's suggesting that the town council send a statement to the General Assembly asking them to reduce their own compensation and eliminate or reduce their own healthcare. "I don't see any rational relationship between being in the General Assembly and healthcare benefits."

Durfee again: Their salary is set by the constitution of Rhode Island. "I wouldn't want the town to look stupid." She and Teitz are going over the history: The current deal was a compromise with reformers to get rid of expensive pension deals.

ADDENDUM 9:00 p.m.:

Tabled pending conversation witth local legislators.

ADDENDUM 9:06 p.m.:

With no notion of how many people might be involved, Solicitor Teitz suggested that the council (out of its contingency fund) pick up the $90 fee for local officials whose boards have not so budgeted to attend a GrowSmart RI seminar. The council passed unanimously up to $900 in payments.

Two Views of the East Providence Teacher Contract Situation

Monique Chartier

NEARI President Larry Purtill sent this letter to all Rhode Island members of the NEA on Friday.

And RISC sent out the following e-blast yesterday:


Today, Rhode Island's emergency is in East Providence, but it could easily be coming to your town next.

There is a very serious situation going on in East Providence that affects YOU - the battle between the teachers' union and the East Providence School Committee is heading to Justice Pfeiffer and could be decided any day ON OR BEFORE JANUARY 23!

The law is clear. School deficit spending is illegal.

State law prohibits teachers contracts from lasting more than three years. There is no teachers contract in East Providence. The teachers union has no basis in law to challenge the school committee's decision.

East Providence faces a nearly $9 Million deficit. Its School Committee must roll back teacher salaries 5% and institute a 20% healthcare co-pay (currently, teachers pay nothing).

And these measures address less than half the deficit!

The East Providence crisis has serious implications for all cities and towns in the state - there is simply no more money to pay for such generous entitlements for one group of public employees while everyone else suffers. Everyone must do his/her part to deal with the state's fiscal crisis. Many teachers understand the situation and are willing to help out; it is the union that refuses to budge.

PLEASE! Sign a petition to register your support of the East Providence School Committee. It will be sent to Justice Pfeiffer, as well as the media. Protect your town. Send a message today!

Jim Ed is IN HOF

Marc Comtois

I've been sparse again....but instead of offering comment on the important political events of the day, I just want to note that Jim Ed Rice is finally in the Baseball HOF:

Jim Rice was elected to baseball's Hall of Fame today, in his final year on the writers' ballot.

He earned 76.4 percent of the vote, more than the 75 percent standard needed for election.

Rickey Henderson also earned elected in this, his first year on the ballot.

Rice becomes the 18th Hall of Famer who spent a significant portion of his career with the Red Sox. The others include Babe Ruth, Tris Speaker, Cy Young, Jimmy Collins, Lefty Grove, Herb Pennock, Jimmie Foxx, Joe Cronin, Ted Williams, Red Ruffing, Harry Hooper, Rick Ferrell, Bobby Doerr, Carl Yastrzemski, Carlton Fisk, Dennis Eckersley and Wade Boggs. The only players in that group to spend their entire careers with the Red Sox are Rice, Williams, Doerr and Yastrzemski.

Behold the Fruits of "Academic Freedom"

Justin Katz

Ever have an educator explain to you that it is important to hear all sides of an argument and to engage the opposition in dialogue? Well, for many humanities professors, that may be a lesson preached more than practiced:

Anyone who needed evidence that the culture wars are far from over could find it here at the annual gathering of the Modern Language Association last week. As the response to David Horowitz's appearance on an MLA panel showed all too plainly, the culture wars haven't ended; they've just reached an ugly stalemate. ...

... In fact, Mr. Horowitz's appearance at the MLA meeting, he said, is the first time that he has defended his views in person before a scholarly group. ...

But members of the audience weren't having any of it. They wanted to challenge the panel about one thing: why Mr. Horowitz was there in the first place.

"Are you now proud that you are the only organization to invite Horowitz to speak?" an angry Barbara Foley of Rutgers University at Newark asked. "Did you do your homework" about Mr. Horowitz's blog, FrontPagemag.com? she continued, to audience applause. Grover Furr of Montclair State University and a self-described "victim" of Mr. Horowitz's book The Professors: The 101 Most Dangerous Academics in America, said he objected to Mr. Horowitz's being invited "not because of his views but because he is a liar." Another audience member complained that out of thousands of MLA members, the organization had picked "two FrontPage columnists" for the panel. ...

At one point, a member of the audience could be seen giving Mr. Horowitz the finger. Brian Kennelly of California Polytechnic State University at San Luis Obispo, who presided over the event, wrote on The Chronicle's Web site that he observed an audience member repeatedly mouthing an obscenity to Mr. Horowitz — behavior he called "troublesome" and "repugnant."

It's telling, and not very surprising, that a roomful of academics required the supervision of security guards. I wonder if they had their Tasers at the ready.


It was Rhode Island's own Rocco DiPippo, by the way, who blew the whistle on Professor Furr. I suspect Grover would think twice before directing his spittle toward Rocco in person.

Dams Versus Waterslides

Monique Chartier

On Thursday, Glenn Beck took a skeptical look at some of the projects that would constitute the proposed economic stimulus plan of President-Elect Obama and the 111th Congress, contrasting them to the projects targeted by the last major federal spending spree intended to jump-start the economy. (Guess which state's polar bear exhibit made his list ...?)

" ... how much money are you spending and how exactly are you going to make it back?" "Well, just the way we did in World War II. We spent all that money in World War II. 11% of our GDP. That's more than we're spending now in relation to our GDP, so -- and look at what happened." "Okay, all right. Well, let's just compare a few things. Didn't we in World War II develop the jet engine?" "Well, yes, of course we did." "Didn't we also do something, I don't remember what -- oh, yeah, the Manhattan Project?" "Well, it was -- yeah, sure." "Didn't we also build dams?" "Well, yeah, of course we did." "Didn't we also build the first highway system?" "Of course we did." "Okay. What are you doing with the $1.2 trillion?"

* * *

... there's a BMX and dirt bike trail at Virginia Key Park. And then they are going to build a Miami Rowing Club building and then there will be the Virginia Key Beach museum. In Trenton, New Jersey they have got 34 requests. They are going to do the Trenton Club renovation project, the Port of Trenton, that is my favorite, people come from all over the world to see the Port of Trenton museum. Then, of course, there's the Eagle Tavern development. I mean, you gotta drink. Then the mayor of Providence, Rhode Island is going to be there. He's going to talk about the Roger Williams Park Zoo. Roger Williams, didn't he sell more albums than Elvis and Boxcar Willie combined? He's going to be in from Providence and he's going to talk about the new polar bear exhibit that they want to build and soccer field improvements. Then the mayor from Philadelphia, Michael Nutter, is talking about the Philadelphia zoo. They are going to -- oh... oh, I didn't know this! They're doing the Big Cat Falls? Yeah! Finally they are going to build a nice waterfall. Well, now I want to go to the Philadelphia zoo and so does everyone from planet Earth. So when I look at the water slide, the BMX dirt trails and the Big Cat Falls and I compare them to the invention of the jet engine and the Manhattan Project and cheap plentiful energy from falling water, hmmm.

Thousands of Sharon Wests

Justin Katz

Many Rhode Islanders surely share the sentiments that Sharon West expresses from East Providence:

Recently, a consultant hired by the committee reported that the average teacher makes $69,000 a year and receives benefits costing $26,000 annually.

Yes, $95,000, and many make even more. The consultant stated that this amounts to an hourly wage of $93. Please bear in mind that currently the School Department is $4 million in the red and sinking deeper every day.

As average homeowners, as well as renters, struggle to pay utility bills, car payments, the mortgage or the rent, buy groceries and pay medical bills, these 180-day-a-year workers want still more. Teachers, look around! These folks are valiantly struggling day by day to provide basic necessities for their families.

We, the working stiffs who pay for everything, need some relief, not further plundering.

The question is whether there are enough of us to force change. Can we (or hard experience) shake enough of our neighbors out of their apathy to counterbalance the well entrenched interests that bind the state? Let's hope the isolated reform movements that have emerged (notably in the East Bay, for some reason) are the tip of the spear, not the rear guard of an exodus.

The Economic Principle of Self Interest

Justin Katz

URI economics professor Len Lardaro had a very disappointing piece in the Providence Journal on Saturday, advising a tax increase in order — curiously enough — to benefit schools and universities. Professor Lardaro states that "investment-related activities... by their nature entail sacrifice" and suggests the following:

I propose raising the state's sales-tax rate to 8 percent from 7 percent, not broadening its coverage to services (to help contain regressivity), and earmarking all of the resulting tax proceeds to K-12 public education and public higher education. Should the legislature try to move any of the resulting revenues to the General Fund (the God of current consumption), I expect Governor Carcieri to veto this measure and take his case to the people.

We should certainly devote resources to "investment-related activities," but layering on funds for education could prove to benefit other states if Rhode Island doesn't make its first goal attraction of businesses. (That's for higher education; when it comes to elementary and secondary education, the bulk of any increased "investment" in schools would simply be absorbed by the unions.) We can spend our last nickel educating young adults, but if we have no jobs to offer them upon graduation, we'll be lucky to get a thank you card from wherever they move.

I'd also mark it as a question whether we'd actually see any long-term increase from a raised sales tax. Lardaro — like Governor Carcieri — should recall that cigarette taxes offered one of the few increases in tax collections, which "the state's chief revenue analyst Paul Dion attributes to a hike this past summer in neighboring Massachusetts." In other words, ratcheting up our overall sales tax could prove to be a boon for neighboring states.

That means that Lardaro's suggested benefit of "contain[ing] property taxes" could very well be fanciful. Even if it were not, though, his rat-a-tat-tat of qualifiers hardly instills confidence. Observe (emphasis added):

Such property-tax containment can also be expected to benefit small business. Caps on property-tax rate hikes can be enforced in this type of environment, and the state might also consider imposing limits on allowable growth rates for local pay packages.

Lardaro has the emphasis precisely backwards. The state ought to begin where he drifts off into a series of maybes: contrive benefits for small businesses, enforce property caps, and impose limits on public sector remuneration. Such measures will protect Lardaro's employer more surely than will the deceptive balm of tax increases.


Professor Lardaro claims that it was a joke to get people angry enough to become involved.

Links to the Gov's Stats

Monique Chartier

In his speech Wednesday evening, Governor Carcieri cited certain statistics pertaining to Rhode Island's taxing and spending. [These links are from my own research.]

Rhode Island's property tax burden is the seventh highest in the country.

H'mm, the Tax Foundation says we have the fifth highest property taxes, state and local combined.

School spending per pupil: Eighth highest

In 2007, RIPEC said that Rhode Island per pupil spending was ninth highest. In April, 2008, the Governments Division of the US Census Bureau reported that our per pupil spending is seventh highest.

Spending per capita on fire services: Number One

Yup, RIPEC concurs.

Spending for law enforcement: 13th highest

In 2007, RIPEC said we were fourteenth highest.

One bright note mentioned on other occasions by the Governor and worth repeating here: thanks to the General Assembly, our income tax rate is and will hopefully continue to be in flux.

January 11, 2009

Et Tu, George?

Monique Chartier

In some parting advice to the GOP on Fox News today [h/t the Washington Post], President George Bush falls into the error of many others who have commented or reported on the subject. He leaves out that one critical word.

And we should be open-minded about big issues like immigration reform, because if we're viewed as anti-somebody — in other words, if the party is viewed as anti-immigrant — then another fellow may say, well, if they're against the immigrant, they may be against me.

Respectfully, sir, no one, Democrat or Republican, who supports the enforcement of our immigration laws is opposed to immigrants. We are opposed to politicians who either fail to discourage illegal immigration by insufficiently encouraging or funding ICE or who openly invite illegal immigration by championing amnesty legislation in the guise of "reform".

This Is How the State Works (Its Way into a Hole)

Justin Katz

It's important to keep in mind that this report consists mainly of allegations, some of them (at least) made by people with compromising motivation. That said, the insight into the practices of our state are well worth familiarization:

[Probate Judge Robert E.] Rainville says he has done nothing wrong — and that the complaints against him are "100 percent politically motivated." He claims that Council Vice President Angelo A. Padula Jr. is trying to oust him because he is a lifelong friend of Stephen Alves, the former state senator from West Warwick who lost a reelection bid in November. ...

In Rhode Island, probate judges are political appointees. They do not operate under any uniform rules but wield great power. They can inalterably change an elderly person's life by appointing a stranger to take control over every facet of their affairs — from how their money is spent, to where they live and with whom they associate.

Some probate judges are experts in probate law. But others have very little expertise in these matters. Some routinely tape-record proceedings so that a complete record of what is said is made; others do not. Some routinely seal parts of court files while similar records in other cities and towns remain open to public inspection. At least one probate judge in the state routinely has lawyers who appear before him make their presentations to him privately at the bench so the spectators in the courtroom cannot hear what he or the lawyers say. The proceedings usually aren't taped, unless a lawyer brings a stenographer to make a record — at the client's expense.

As part of their duties, probate judges decide what fees to award guardians and lawyers who represent estates. The amounts charged vary greatly based on the complexity of the case, the amount of time spent by the attorney and how much the lawyer charges per hour, which varies based on the attorney. The Supreme Court Rules of Professional Conduct put no limit on what a lawyer may charge, only that the fee be "reasonable."

At first reading, so to speak, it's difficult to understand how a part-time legislature and the small-scale operations of our tiny state engender such endemic corruption as we all know to exist, but when one digs into matters, it begins to appear that the principle of mutual back scratching permeates the entire structure of government. It's as if corruption is laundered so thoroughly that it transcends the law.

That's why no one should be surprised if Rhode Island scores more highly in corruption as a matter of opinion survey than of prosecutions.

Paranoid Thought for the Day: Craigs List

Monique Chartier

Of course, there are tire kickers, not to mention the offering of services which are illegal in most states. But overall, the reviews are very good. Wood chippers, skis, washing machines, cars, on and on - friends and family have enthused about the stuff they've been able to sell or the bargains they've obtained via this free (did I mention free?) classified listing service.

It is difficult, however, not to speculate that there is bad intent behind the offering - gratis - of a good service. Especially as the service is not offered entirely without strings attached. Or more specifically, cookies - cookies that could track all websites visited and do heaven knows what else. Not to mention - cue ominous music - the millions of e-mail and IP addresses harvested.

So who is behind Craigs List and what is their ulterior motive? My own suspicion, based solely on their ruthlessness and demonstrated lack of values, is that it is the Chinese government. And their ultimate goal is world domination. Craigs List alone will not achieve this for them, naturally; it is but one tool in their arsenal box.

But I am open to suggestion on the matter so feel free to posit your own threat or conspiracy.


Commenter Pitcher points out that Craigs List is not free in all market, as it charges for

help wanted ads in three cities, and for apartment rental listings in NYC from apartment brokers

Additionally, dealing a serious blow to my theory that the Chinese government is behind Craigs List, it appears that there is a real Craig - his name is Craig Newmark - and he has a foundation, the Craigslist Foundation.

An unkind characterization of the foundation would be that it is borderline "commie", emphasizing as it does the development of non-profit organizations. (Why are so many people down on profits?) But this deals the fatal blow to my theory. Highly unaverse to profits (even if channelled solely to those in power and their cronies), the Chinese government is communist in name only.

The Declarational Power of the O

Justin Katz

"O" continues to stand for "audacity":

President-elect Obama countered critics with an analysis yesterday by his economic team showing that a program of tax cuts and spending such as he has proposed would create up to 4.1 million jobs, far more than the 3 million that he has insisted are needed to lift the country out of recession.

Of course, in the AP style book, "showing" apparently means "insisting based on data and plans that remain secret":

Obama has provided few details of his $775 billion plan so far. This fresh report does not include the specific construction of his tax cuts, the amounts dedicated to state aid or public works -- key questions that Obama aides have closely held.

Yesterday, economic aides and advisers wouldn't lay out even rough estimates for the plan's components. They said they worked with broad instructions from Obama but didn't want to limit negotiations with congressional leaders by outlining their limits in public.

In other words, there's more than a little showmanship involved in the declaration that the plan will now "save or create" an additional million jobs. This is a telling tidbit, though:

If Congress fails to enact a big economic recovery plan, Obama's advisers estimate that an additional 3 million to 4 million jobs will disappear before the recession ends.

It's conceivable that the Obama team revised its analysis upwards because updated economic indicators suggested another million jobs might be lost, and they're operating under the assumption that pumping a bunch of borrowed federal dollars into the economy will halt the slide. It's difficult enough to tell whether a particular action helped to create jobs; promises to "save" them on this scale are meaningless.

No Precedent for the Irons Ruling

Carroll Andrew Morse

In today’s Projo, I have an op-ed detailing how the Rhode Island Superior Court’s dismissal of the Ethics Commission case against William Irons ignores basic precedents that have been established by the Courts regarding legislative immunity. The decision is being appealed to the Rhode Island Supreme Court.

More detailed background on the cases cited and on the history of the interpretation of legislative immunity is available here and here.

Only the Perfect Need Be Born

Justin Katz

Welcome to the morally ambivalent new world and its updated version of eugenics:

This BBC article celebrates the birth in Britain of the first baby tested in vitro for an altered form of the BRCA1 gene known to vastly increase the risk of breast cancer. The girl—whose family has been very hard hit by the disease in prior generations—was conceived by IVF and tested when she was still an embryo, before being implanted in her mother's womb. She was very fortunate not to carry the altered form of the gene, because if she had been found to carry it, she would have been killed. ...

Better to eradicate the carriers, it seems, than to risk a potentially curable if very serious adult-onset illness. So should cancer patients wish they had never been born? Should the rest of us wish they hadn't been?

In the vanity and selfishness of our age, the implication is more accurately that parents who fear their children's cancerous future should lament that they never had the opportunity to snuff them out prior to the crib.

January 10, 2009

When Terrorists Smile

Justin Katz

Mark Patinkin's reasonable on the Israel-Palestine conflict:

These were not rogue militants acting on their own. Gaza is now controlled by the extremist Hamas government. The missile firings were allowed, even encouraged, from on high.

At last, on Dec. 27, Israel launched a counterattack to stop the rockets.

Much of the coverage outside the United States has cast Israel as the belligerent villain responsible for killing innocents. There is little mention by sites like Al-Jazeera of how militants hide in mosques, schools and neighborhoods, firing from behind those shields. When Israel fires back, it is called a war crime.

I've emphasized a key sentence in the above, and a vignette in the New York Times comes to mind:

A car arrived with more patients. One was a 21-year-old man with shrapnel in his left leg who demanded quick treatment. He turned out to be a militant with Islamic Jihad. He was smiling a big smile. ...

"Don't you see that these people are hurting?" the militant was asked.

"But I am from the people, too," he said, his smile incandescent. "They lost their loved ones as martyrs. They should be happy. I want to be a martyr, too."

More than likely, this individual is, as Mark Steyn puts it, suffering from "a mental illness masquerading as a nationalist movement," but he might just as well have been smiling about the journalists' capturing the hospital scene. No doubt those above him in the Islamofascist ranks — safely ensconced in bunkers or even in other cities — were smiling because their well-practiced strategy is playing out once again.

Look, the various factions of Islamic fundamentalists have the game of the Middle East conflict down. They poke and provoke Israel until the nation responds; they wait for world opinion to grumble from within its stupor; and they declare that all they've really wanted was some small thing — some incremental step toward their end-Israel objectives.

Eventually it becomes a matter of survival to finally knock the weaselly bully out.

Always an Excuse for the Status Quo

Justin Katz

A comment from the Poverty Institute's Linda Katz (no relation) in today's article about the sides "lining up" in the argument over the global Medicaid waiver expresses an increasingly common sentiment:

Rhode Island College's Poverty Institute policy director Linda Katz said it's a mistake to agree to a five-year spending cap without knowing what the state's needs could be.

"No one can see into the future," she said.

Katz suggested Rhode Island would not need such a drastic overhaul of its Medicaid program if Congress pumps an additional half a billion Medicaid dollars into the state, a possibility raised in a report issued this week by the Georgetown University Center for Children and Families and the Center on Budget and Public Priorities.

Just so: Nobody can see into the future. The rational lesson of that conclusion is to prepare for the worst. That, as our crumbling society evidences, is not a lesson that Rhode Island has proven willing to hear. Every year has been one more exercise in wishful thinking, waiting for miracle windfalls.

That must change now. The economic clock is ticking.

Nonsense Opposition to DOMA

Justin Katz

One doesn't have to follow the same-sex marriage debate for long to recognize a strain of human tendencies with which I became familiar as an ideological minority in the college classroom.

As I duked it out with the professor, most of the students would rush to take his or her side (silence from others being an indicator that they may have feared to take mine), and any excuse to affirm their position would spark a declaration of the form, "See! That's conclusive." Sometimes the catalyst was a reasonable (but not decisive) point, but just as often it was a wholly inadequate analogy or even just a superficial semantic twisting of my own arguments.

Such is the Providence Journal's seconding of former U.S. Congressman and former Libertarian presidential candidate Bob Barr's recent op-ed arguing for repeal of the Defense of Marriage Act (DOMA). Barr's key point is utterly nonsensical:

In effect, DOMA's language reflects one-way federalism: It protects only those states that don't want to accept a same-sex marriage granted by another state.

The Full Faith and Credit clause of the U.S. Constitution doesn't need to be guided in two directions on this matter. It simply isn't plausible to suggest that states that want to recognize same-sex marriage might be forced not to because another state does not.

There are only two actual reasons to support the repeal of DOMA. The first is to curry political favor with the homosexual movement and those who like to feel as if they can play the Right Side of History game on their behalf. The second is to enable the judiciary to force a radical change in the definition of marriage from coast to coast, thus enabling elected officials to allow their proclaimed personal view of marriage to be subverted in a way that leaves their hands clean.

In the process, mounds of verbiage are being piled up to excuse the imposition of a policy preference based on emotion, not reason, and to obscure the implication that supporters, while they may believe democracy to be a nifty principle, are much more interested in crafting the laws to suit their own tastes than supporting their fellow Americans' right to shape their own civil society.

A Better Peace?

Justin Katz

Like any patriot, I've got a problem with this:

U.S. manufacturers say they've learned to compete against China's lower wages. What they can't compete with are government subsidies that enable China to sell some finished products for less than the fiber alone costs in the United States.

The difficulty is in the solution. I've got my reservations about such manifestations of internationalism:

In an effort to mitigate the possibility of the Chinese dumping textiles, several members of Congress have called for the International Trade Commission to monitor Chinese textiles more closely now that the quotas are expiring. ...

She initiated a case with the WTO to get China to stop its allegedly unfair trade practices, but it probably will be up to the incoming Obama administration to decide whether to file a formal case. China would face sanctions, such as penalty tariffs, if it didn't agree to stop violating trade rules.

No doubt, international organizations help to smooth the flow of history, and they probably do much to avert war. I wonder, though, at the cost of history with no sharp edges, as I wonder who benefits most from negotiated peace. The former will yield no satisfying answers until an edge pokes through the veneer and we all observe how well the tear heals. The answer to the latter would seem to be "the aggressor."

An aggressive nation like China will seek ways — in front of and behind the podium — to influence votes on any relevant council, and the outcome will be the imposition of various members' desires. On the other hand, if the United States acted alone, explicitly matching China's nakedly self-interested actions, the Chinese market would be harmed, and escalation would be its call.

In general, I think our state-to-state federal system works because national patriotism exists. There is no such emotion, and no fortified culture, behind international federations. In part for that reason, they bind the hands of those who follow the rules and hesitate to trip up those who do not.

How To Achieve the Eighth Highest Pay in the Country ... And Where the Method May End

Monique Chartier

Increases in teacher compensation in Rhode Island have been achieved on "They got it, so we should" reasoning. The gains in one city or town's contract are referenced in subsequent negotiations in other municipalities. I had always thought that this was done informally, however, until I saw Item #3 of the Tentative Agreement, first page of the expired "Agreement between East Providence Education Association and East Providence School Committee":

For 2007-08, the maximum step of the basic salary schedule shall be ranked number 12, based upon the thirty six school districts excluding Davies and School for the Deaf, who have settled contracts as of November 1.

The City Council and School Committee of East Providence, not color blind to budgetary red ink, may put an end to this ... tradition. Certainly this possibility has occurred to the EPEA, which sent out an e-blast, below, to its members suggesting attendance at Tuesday's East Providence School Committee.

The East Providence teachers are defending all of our rights in their fight not to allow the school committee and city to unilaterally roll back their wages and impose co-share amounts. East Providence teachers will be attending the school committee meeting Tuesday evening at East Providence City Hall (7:30 PM) and can use your support. Local President, Val Lawson, and the entire local union are staying united and fighting for all of us.

Come and show your solidarity! Stand up for Collective Bargaining!

January 9, 2009

School Regionalization Does Not Save Money

Monique Chartier

The Ocean State Policy Research Institute has shot holes - on the basis of sound figures from the US Dept of Ed - in the well repeated and well intentioned suggestion to merge most of Rhode Island's thirty six school districts.

This from an OSPRI press release of today. [Emphasis added.]

As more towns and schools scramble for cost savings, the call for "regionalization" seems to be gaining momentum. However, new research by the Ocean State Policy Research Institute (OSPRI) shows that, at least with education, it would probably increase costs.

"It's a very easy pitch to say 36 school districts with 36 superintendents are more expensive than five regionalized districts with five superintendents. Unfortunately, it's not true," said OSPRI President William Felkner. "I bought it too, until I saw the data."

The U.S. Department of Education's National Center for Education Statistics' (NCES) latest published data (The 2007 Digest of Education Statistics that reports extensively on the 03-04 school year) show that Rhode Island school districts on average spend 7.9% of their current expenditure budgets on administration and supplies, the 2nd lowest of any state.

Administration and the "economies of scale" derived from combined purchasing are the two items touted to deliver savings from regionalization and Rhode Island already appears relatively lithe in these departments. Even on a per pupil basis, RI spending in these areas is lower than most of the nation and in the top 20 when looking only at "general administration" which are the costs for school district management including the superintendent's office.

"Using a business model, consolidation of services makes sense," Felkner said. "But when government mandates such actions and higher levels of governance are created, accountability suffers and costs rise."

Rhode Island has experience with regionalization and it has ballooned both administrative costs and per pupil costs. Taxpayers of regional districts have not seen savings nor has the state.

When comparing fully regionalized districts to similar size town districts we find that regionalized districts have the highest per pupil costs. One example is the Chariho Regional School District which was put together from three towns to make a school district whose student body is the same size as neighboring Westerly. But, the supposed economies of scale are nowhere on display in Chariho where administration costs per pupil are $825, forty percent more than the $589 spent in Westerly.

Indeed, when it comes to administration costs, the supposed venue for obvious savings, they are well above the median in ALL the regionalized districts.

"When it comes to schools, the solution is not 'streamlining, streamlining, streamlining,' it's 'salaries, salaries, salaries,' and the way to reform salary and benefits is through transparency. Give taxpayers a window on exactly how their money is spent, before, rather than after committing to the spending - as reflected in the East Providence School Committee's proposal for negotiating contracts in public."

The same NCES data source shows that 58.8 % of RI school budgets are devoted to teacher salaries and benefits, the nation's 6th highest. An evaluation of per pupil salary and benefit spending jumps that rank up to the 2nd highest in the nation. And if one wonders what methods might be effective at holding the line on teacher salaries, transparency or regionalizaton, just look at what teachers' unions say. They object to the former and embrace the latter.

Europe Still Europe

Justin Katz

Given what follows, it's difficult to comprehend Matthew Stevenson's initial statement that "the more general trend is European indifference to the policies of the United States." He proceeds to explain:

Economically, Europeans blame America’s financial narcissism for the recent market panic and recession.


On security, Europeans feel hung over from the binge of recent American imperialism.

I more or less stopped drinking a few months ago, but I don't recall ever being "indifferent" about a hangover, and if I'd ever had one because somebody else got drunk, I'd have been something quite different than ambivalent. And that brings us back to do.

Europe remains Europe: inclined to drift languorously off to a hibernal vacation from history and agitated whenever the nations keeping watch cry out an alarm.

Making Indoor Prostitution Illegal

Carroll Andrew Morse

And while we're on the subject of Democrats sponsoring sensible legislation, let's not forget to mention that State Representatives Joanne Giannini (D-Providence), Elaine Coderre (D-Pawtucket), Helio Melo (D-East Providence), Al Gemma (D-Warwick), and Deborah Fellela (D-Johnston) have reintroduced the bill to the Rhode Island House (H5044) that would make indoor prostitution illegal in Rhode Island.

If this is the first you've been informed that indoor prostitution is currently legal here in Rhode Island, click here, here, or here for more background on the issue.

Election Bills Before the RI House

Carroll Andrew Morse

There are two bills regarding election procedures, already pending in the Rhode Island House of Representatives, that are worthy of public attention:

  • H5051, sponsored by Representatives Al Gemma (D-Warwick), Patricia Serpa (D-Coventry/Warwick/West Warwick), Joanne Giannini (D-Providence), Peter Kilmartin (D-Pawtucket) and Gregory Schadone (D-North Providence) which, to quote the official description, "would require all voters to provide proof of identification with their photograph issued by the state or federal government before voting."
  • H5052, sponsored by Representatives Gemma, Peter Petrarca (D-Johnston/Lincoln/Smithfield), John DeSimone (D-Providence), Laurence Ehrhardt (R-North Kingstown) and Jon Brien (D-Woonsocket) which would place a non-binding question on the next general election ballot, asking if the straight-party voting option should be discontinued in RI.

Joe Trillo (and Amy Rice?) For Lowering the Corporate Income Tax Rate

Carroll Andrew Morse

A bill has already been introduced in the Rhode Island House (H5034) to lower the state's corporate income tax rate from 9.0% to 7.4%. As far as I can tell, there are no gimmicks in this particular bill, no lowering-but-broadening schemes or anything like that, just a permanent lowering of the corporate tax rate starting in 2010. State Representative Joseph Trillo (R-Warwick) is one of the bill's sponsors, further lending credence to the idea that it's for real.

What surprised me a bit is that Representative Amy Rice (D-Portsmouth/Middletown/Newport) is also a sponsor, along with Raymond Gallison (D-Bristol/Portsmouth) and Jack Savage (R-East Providence). Is it naive for me to think that this particular lineup could be the result of democracy actually working at the participatory level, and the East Bay reps listening to the concerns of the various taxpayer groups that have been active in that part of the state?

Still Against Targeted Economic Development

Justin Katz

Here's a good illustration of why I oppose targeted economic development in lieu of a broad improvement of the general business environment in Rhode Island:

For years, the financial-services sector has been one of the few growing industries in the state's sputtering economy, generating consistent job growth and high wages. Employment in financial services has risen every year since 1996, up 31 percent in all. The average salary for the state's finance workers — including real estate agents, stockbrokers and analysts — is $67,349, almost 60 percent above the average income.

But Rhode Island's housing meltdown and Wall Street's unraveling have not spared the pride and joy of this state's economy. Total jobs in financial services fell in 2007, and by last November, employment was down to 33,000, nearly 2,000 below the 2007 level.

If the financial sector had developed here of its own accord, that would be one thing, but this "pride and joy" has been specifically nurtured:

State officials rolled out corporate and personal tax breaks and other incentives to lure Fidelity, expand Bank of America’s footprint and keep local firms from skipping town. Those moves have paid off, with the sector producing $1.5 billion in wages.

Increased wages are wonderful, but nothing comes without cost. What might have happened had the same resources that went to a preferred industry been redirected more broadly, we can't say. This significant "nor" leads to an important possibility, however:

Nor are all financial-services companies suffering. Having largely avoided the subprime mortgage plague, the state's credit unions have not crumbled like some of their larger counterparts. Smaller lenders are not immune to rising delinquency rates, as out-of-work borrowers fail to repay their debts. But as of last September, full-time employment at Rhode Island credit unions had dropped less than 1 percent compared to a year ago.

Local credit unions are the sort of businesses that people open because they are driven to improve their financial situation, not because the government has provided narrow perks. (Although the industry that entrepreneurs enter is surely affected by such factors.) If the powers who be in Rhode Island were less tempted toward steering the state and more inclined to remove barriers that limit its motion all around, there would be more businesses founded on the individual interests and talents of Rhode Islanders, being run with do-or-die care, the lack of which led national and international financial firms down the path of poisoned profits.

The Next Big Oops

Justin Katz

Across the society, from cornered municipal officials to the national commentariate, people are preparing the way with palms for the eye-popping stimulus proposals of Obama and Congressional Democrats. A radio report, the other day, explained that the president-elect recognized that the stimulus plan required a tax cutting component, and although, unlike conservatives, liberals see tax cuts as expenditures, alongside a trillion dollar spending plan, a few hundred more billion tacked on to the end hardly registers. Why hasn't anybody thought of the spend-without-reservation federal economic strategy before?

One can almost hear the twenty-second century history books being written: "At that time the flawed idea that government spending needn't be controlled swept the troubled nation like an opiate wildfire."

Paul Krugman, for high-profile example, thinks that both the short and the long term focus should be on nationalizing budgets. "No modern American president would repeat the fiscal mistake of 1932," he writes, "in which the federal government tried to balance its budget in the face of a severe recession." Casting his argument in terms of state-level action, Krugman sees the advantage of federal concentration mainly as being that the federal government can "borrow [its] way through the crisis." Frankly, it's as if Krugman isn't aware that the federal government's financial prospects are affected by the economy:

Think about it: is America — not state governments, but the nation as a whole — less able to afford help to troubled teens, medical care for families, or repairs to decaying roads and bridges than it was one or two years ago? Of course not. Our capacity hasn't been diminished; our workers haven't lost their skills; our technological know-how is intact. Why can't we keep doing good things?

It's true that the economy is currently shrinking. But that's the result of a slump in private spending. It makes no sense to add to the problem by cutting public spending, too.

To any arguments involving the cost of paying workers to utilize those skills or of employing that technological know-how, Krugman would apparently answer: borrow.

Me, I believe the public needs a strong dose of this sort of thinking to counter its current delirium:

Former U.S. comptroller David Walker has long been a leading advocate of fiscal sanity, and I called him today to get his take on the latest CBO budget-deficit projections ($1.2 trillion for next year, trillion-plus deficits for years to come). "If trillion-dollar deficit numbers for several years in a row don’t wake up Washington and America to the nature of our fiscal problems, then I don’t know what will," he says.

Walker says, "For the first time in the history of the U.S., the federal government owes more in liabilities [including unfunded commitments for Social Security and Medicare] than American households are worth." And that gap is widening, he says. "The fiscal hole is getting deeper, and household worth continues to decline." ...

He adds, "We need to realize that the same factors that led to the subprime crisis — too much debt, too little attention to cash flow, ineffective risk management, and waiting to do something until the crisis hits the door — those same factors exist for the federal government’s fiscal situation, with one big difference: No one is going to bail out America."

Walker seems to have missed the lesson about economic rules not applying to the federal government, which can simply wish things to be true.

January 8, 2009

Governor Battles "Soak the Rich" on Newsmakers

Justin Katz

Governor Carcieri's appearance on this weekend's Newsmakers is already online. He certainly makes me a lot less self-conscious about talking with my hands on television. Performances aside, Ian Donnis was responsible for an interesting exchange:

Ian Donnis: Governor, wealthy Rhode Islanders have received tax cuts over the last ten years, so how do you respond to those critics who say that it's unfair that middle class Rhode Islanders are paying a bigger share of the tax burden?

Governor Carcieri: They're not. Middle class Rhode Islanders actually are relatively low taxed. I mean, I'm not in favor of taxes, and I would like to reduce them for everybody, but if you compare the taxes that our citizens pay in the middle income with nearby Massachusetts, they're lower — income taxes.

Ian: But if the affluent residents are paying less, doesn't that raise the burden on other Rhode Islanders?

Carcieri: We've been actually bringing the costs down. We've been reducing the cost of government, if you will. That's my point. We've taken eighteen hundred people out of the workforce. The annualized savings, when you take benefits and that, it's almost $200 million a year, Ian. You can't tax people. What do they do? They leave. That's our basic problem — what I said at the beginning. We're driving away businesses; we're driving away people that have been successful. That's not smart economic policy. We ought to be welcoming them here and figuring out ways.

For some perspective from the House Revenues Tax Facts report (PDF), here's the change in tax liability — the amount of money from 2005 to 2006 to which the state government laid claim — for each income group:

2005 ($) 2006 ($) % change
Total 965,459,393 1,025,126,595 6.18
<$30,000 42,701,426 40,475,498 -5.21
$30,000-$50,000 81,347,929 79,845,718 -1.85
$50,000-$74,999 116,752,274 115,514,348 -1.06
$75,000-$99,999 110,669,935 112,622,052 1.76
$100,000-$199,999 221,305,821 241,709,256 9,22
$200,000+ 392,682,009 434,959,724 10.77

Clearly, by this measure, "tax cuts for the rich" have not shifted any burden toward the middle class. Of course, as I pointed out the other day, tax credits actually shift ultimate tax payments into negative growth. But who benefits? Well, here's the same table with each group's % of the total income tax burden:

2005 (%) 2006 (%) % change
Total 100 100 0
<$30,000 3.84 1.28 -66.55
$30,000-$50,000 8.52 7.93 -6.84
$50,000-$74,999 12.31 11.57 -6.07
$75,000-$99,999 11.67 11.24 -3.69
$100,000-$199,999 23.32 23.96 2.72
$200,000+ 40.34 44.02 9.12

So, contrary to Ian's logical progression, taxing the rich less has not raised the burden on other residents. In fact, excluding the credits — which are given, in a sense, for spending money on things on which the government would like people to spend money — the actual tax value of the top tier went up. The reason is clear: The over $200,000 group saw an increase of overall adjusted gross income (AGI) of 14.38%, but the average AGI of such households increased by only 5.63%, which means that the number of households in this category, paying at the upper tax rate, increased — 8.29% by the numbers.

Wrongly Thought, Wrongly Said

Justin Katz

My grammatical standards drop for items that I read on the Internet. It's a quick and populist medium, so expecting perfectly honed paragraphs constitutes a show of arrogance.

That said, somebody who has just decried the governor's " doddering style" should be careful not to offer such phrases as "Rhode Islander’s overwhelming rejected" as a finished product.

But let's move on to substance:

Luckily we didn't elect John McCain to be president. Said another way, what we heard last night from Governor Don Carcieri was change you can't believe in. Rhode Islander's overwhelming rejected this kind of thinking in 2008. 63% of us voted for Barack Obama, a man who promised to expand the rights for workers to form unions, to tax the rich more, and to spend more on social programs. We elected a freshman class of legislators that are overwhelmingly progressive. We turned away the hard right of the Republican Party in favor of people who repudiate the belief that tax cuts for the wealthy are better than wage protections for the worker. In every race where a Democrat ran as a member of the Democratic wing of the Democratic Party they won, sometimes turning out Republican incumbents.

Even if we ignore the fact that many people who voted for Obama did so based on a belief in his promises of moderation, even if we ignore local races in which Republicans, Independents, and conservative Democrats did have some victories, we have still not honed the topic down to anything relevant to the appropriate actions of the governor and incumbent legislators. We elected Governor Carcieri to be Governor Carcieri — not a functionary to implement the inferences of certain interpretations of subsequent election cycles. Incumbent legislators aren't tasked to endorse the programs of their newest peers. Indeed, the presence of incumbents, of a specific governor, is often a factor considered in the voting booth.

So let those who've been elected do what they were tasked to do. And if they are victorious, let them own the improvements and damage that they have wrought.

R.I.P. Father Richard John Neuhaus

Marc Comtois

Founder of First Things and one of this country's preeminent theologians, Father Richard Jon Neuhaus has passed away. From the National Catholic Reporter.

From the early 1970s forward, Neuhaus was a key architect of two alliances with profound consequences for American politics, both of which overcame histories of mutual antagonism: one between conservative Catholics and Protestant Evangelicals, and the other between free market neo-conservatives and “faith and values” social conservatives.

In 2005, Time magazine took the unusual step of including the Catholic Neuhaus on a list of America’s 25 most influential Evangelicals, noting that in a 2004 session with journalists from religious publications, President George W. Bush cited Neuhaus more often than any other living authority.

“Father Richard,” the president said then, “helps me articulate these [religious] things.”

To Catholic insiders, however, it was Neuhaus’ writing rather than his political activism that made him a celebrity. From the pages of First Things, the unapologetically high-brow journal he founded in 1990, Neuhaus kept up a steady stream of commentary on matters both sacred and secular.

In broad strokes, Neuhaus was an unabashed supporter of the papacies of John Paul II and Benedict XVI, and his commentary was prized in Rome. John Paul, for example, named Neuhaus as a delegate to the 1997 Synod for America. Yet he was no lapdog for ecclesiastical authority; he lamented the Vatican’s opposition to the Iraq war in 2003, and early in Benedict’s papacy Neuhaus voiced “palpable uneasiness” that the new pontiff was not clamping down on what Neuhaus saw as dissent from church teaching.

Over the years, even people who disagreed with Neuhaus’ politics or theology would devour his monthly essay in First Things, titled “The Public Square,” for sheer literary pleasure. His combination of epigrammatic formulae and occasionally biting satire often reminded fans of English-language Catholic luminaries of earlier eras, such as G.K. Chesterton or Cardinal John Henry Newman.

Child's Best Friend

Justin Katz

The following story makes me think that it mightn't be a bad idea finally to fill the gap left by our previous dog:

An animal that wildlife experts believe to be a coyote attacked a 7-year-old girl on Prudence Island on Dec. 30, grabbing her by the arm and dragging her toward the woods.

But the girl's white American Labrador, named Kelly, fought the attacker off and saved her from injury.

According to what a Department of Environmental Management representative from the Fish and Wildlife division told Portsmouth police, this would be the first recorded coyote attack on a person in Rhode Island. ...

Lauren told her mother that she had heard rustling in the woods and had thought it was their neighbor and his beagle. When Lauren got closer to investigate, she said she saw what she thought was a dog that was taller than her Labrador and was a black/brown color. The description that Lauren gave of the animal matched a coyote sighting by her neighbor a short while earlier. No dogs living nearby fit the description.

When Ms. Allard spoke to a Department of Environmental Management wildlife biologist he concluded that it must have been a coyote.

"When it spotted her, it charged her," Ms. Allard said, repeating how Lauren described the attack.

Wearing only a long-sleeved shirt and a vest, Lauren was bitten on the arm. Lauren said that the coyote pulled her by the arm toward the woods. As Lauren tried to tug away from the animal's grip, Kelly jumped in and bit the attacker's rear leg.

The Details of the Governor's Supplemental Budget

Carroll Andrew Morse

For those interested in full detail, the complete text of the Governor's budget proposal is already available from the Rhode Island Legislature's website. I recommend the PDF version over the HTML in this case, since it's a little easier to tell what's being added and what's being removed in the PDF scheme.

Let me add that, despite the many problems with Rhode Island government, one consistent area of excellence is the legislative staff's work in making a large volume of information regarding proposed legislation available to the public after a very short turnaround.

Moving Forward

Justin Katz

Last night on the Matt Allen show, I mentioned our coverage of the governor's speech and gave some general suggestions about the direction of Anchor Rising in the new year. Stream by clicking here, or download it.

I have to say that the governor's plan takes more ground (and concedes less) than I'd expected, giving me some hope that the state can head in a better direction without utter collapse. As I wrote in the comments to our liveblogging post, it's important, however, not to forget the basics of Rhode Island politics just because we're relatively happy with the governor's direction.

Part of the "political coverage" built into our system as it stands is coverage to do the wrong thing. The House may pass this proposal having already arranged for the Senate to make fatal changes. On something else down the road, the Senate will take a political risk, and the House will kill it. Meanwhile, the governor's new commission on consolidation (empowered to propose legislation directly) will contain a mole or two who'll scuttle advancement in the governor's name.

And as I said in response to a question about how legislators could get away with raising taxes in this environment: Wait until just after an election.

January 7, 2009

The Governor's Proposed Changes to Rhode Island's Labor Law

Carroll Andrew Morse

These are some of the state labor law changes being proposed by Governor Carcieri as part of his budget reform package...

Article 25:

…makes explicit a school committee's authority to lay off teachers in the event of budget deficiencies without a particular hearing for the teacher being laid off.
Article 26:
…requires towns, cities and school committees to post proposed collective bargaining agreements on the appropriate town or city website 30 days prior to contract ratification.
Article 27:
…explicitly prohibit[s] "work to rule" labor actions by certified public school teachers. It also imposes…the loss of two days pay for each day of a strike and provides that a labor organization that promotes strikes shall lose its representational status and its ability to collect dues from its members for a period of three years.
Article 28:
…enhances the Department of Education's authority, in school districts under progressive support and intervention, to assign teachers to positions where they are most needed without collective bargaining contractual provisions.
Article 29:
…secure[s] school committee's management control over issues that are not appropriate for collective bargaining.
Article 43:
…[removes] any issue(s) relating to minimum manning from the scope of issues which can be negotiated or arbitrated under the policemen's and firefighter's arbitration laws.
Article 44:
25% cost sharing requirement for municipal employee health insurance.

The Governors Pension Proposal

Carroll Andrew Morse

Governor Carcieri's proposal has two major ongoing items relating to non-disability pensions...

  1. Elimination of cost-of-living adjustments for state and municipal employees who retire after April 1, 2009.
  2. Establishment of a minimum retirement age of 59 for state and municipal employees, including teachers, to be eligible for retirement.
Also, the Governor's plan calls for only 25% of the state contribution to the retirement fund for teachers, judges, state police officers and state employees to be made for the period between February 1, 2009 and June 30, 2009. I'm not sure how much of the contribution deferral is offset by the above two changes.

And if I understand this properly, the plan calls for local communities to make only 25% of their scheduled pension contributions. Correspondingly, state education aid to each city and town will be reduced by the amount deferred.

Tasting the New Environment

Justin Katz

I just heard on WPRO that the judge won't decide whether to stop the East Providence School Committee's unilateral employment change until the 23rd. It looks like union members will start to feel the pinch of not giving concessions.

That's a huge change for the better from an environment in which they expect to get back pay no matter how long they hold out.

Index of the Governor's Budget Proposals

Carroll Andrew Morse

Here's an index of the major items in Governor Donald Carcieri's supplemental budget reconciliation plan. "Major" in this context is defined as any item saving $10 million or more for FY2009; the 10 items below account for $305 million of the $357 million deficit (85% of the total).

Eliminate General Revenue Sharing to Cities and Towns$55.1M
State Agency Corrective Action Plans$51.2M
Reduce Local Education Aid, Corresponding to Pension Contribution Deferral$41.1M
Defer Repayment to Rhode Island Capital Plan Fund$38.4M
Lowered Teacher's Retirement Fund Contribution$28.1M
Anticipated "Medicaid Stimulus"$27.5M
Lower State Employee Retirement Contribution$25.9M
Increased Revenue from Raising Cigarette Tax$17.4M
Medicaid CNOM Savings$10.5M
Defer Station Fire Settlement Payments$10.0M

Liveblog: Governor Carcieri's State of the Crisis Address

Engaged Citizen

The comments section of this post is devoted to liveblogging the governor's speech presenting his "supplemental budget."

A lot could be riding on this speech. If the governor doesn't step up to the plate and show indomitable determination to resolve some long-standing problems — perpetuated by powerful interests — the state could be in for a long, cold spiral.

So, will the governor see his shadow tonight?

Some Things to Expect?

Justin Katz

Through email channels, I've been alerted to some items from the governor's supplemental budget. I don't have time to ponder them extensively, just now, but here they are:

Article #7 suspends any General Revenue Sharing payments for the current fiscal year: loss of $55.1 million
#17 freezes the tax rate applied for the Public Service Corporation (Telephone) Tax to stop further losses in tax revenue which goes to cities and towns
#19 creates a statewide health insurance contract which municipalities may opt out of if they can prove they’re realizing more savings under their own plan
#20 expands joint purchasing opportunities to services
#21 establishes a panel to resolve school-municipal budget disputes in any year there is a reduction in general or education aid
#40 establishes last-best offer, total package arbitration as the impasse procedure to resolve contract disputes with police and firefighter unions
#41 establishes several commissions to study and report on municipal public safety and other consolidations/mergers by March 10, 2010
#42 expands the criteria that arbitration panels must consider in rendering their decision and allows for arbitration awards to be up to three (3) years in duration
#43 removes all issues related to manpower levels and deployment from police and firefighter collective bargaining
#44 mandates a 25% health insurance (including dental and vision care) co-payment for all municipal employees and school teachers
#45 makes major changes to the Municipal Employees Retirement System and also affects private, municipally-administered pension plans (e.g. 1% increase in employee contributions, 50% disability pensions, min. 30 years service or age 59, 25 years service for public safety pensions)
#46 reduces on-the-job injury pay to police and firefighters to 80% of pay rather than 100% of their pay
#47 prohibits municipal employees from being sued in their personal or individual capacity, limits joint and several liability and eliminates the award of pre-judgment interest by the courts

A One-Way Street Across a Two-Way Border

Justin Katz

I may be misunderstanding him, but it appears that Rhode Island elementary and secondary education commissioner Peter McWalters believes that Rhode Island should seek to attract illegal immigrants to our state in order to educate their children:

In Rhode Island, McWalters said, "We're not in agreement that these kids are worth it because we are torn between a culture that's says, 'We don't want you,' and one that wants them to come here. We have to decide that these kids are worth it and that it is necessary to pay the bill."

I don't know, commissioner; we've got an awful lot of bills to pay. We should educate children while they're here, but for a state in our condition to deliberately court an intractable problem would be the height of insanity. Just skim down the article a few paragraphs:

English language learners are not a monolithic group, however. Nearly two-thirds are second- or third-generation Americans, with at least one parent born in the United States.

People that ambivalent about joining the culture into which they've moved probably aren't the human resource investment that Rhode Island ought to be prioritizing.

The Governor, Us, and You

Justin Katz

So you can plan your evening: We'll be liveblogging the governor's speech tonight at 7:00, and we'll be doing so in an Engaged Citizen comments section that'll go up around that time, so you can liveblog right along with us.

Should the Goal of Education Policy Be Results, or Preserving a Particular Bureaucratic Form? How They React in Boston Will Let Us Know…

Carroll Andrew Morse

James Vaznis of the Boston Globe reports on research from our neighbor to the North (Massachusetts, that is, not Canada) regarding Charter schools…

Charter schools were created as part of the 1993 Education Reform Act, as a way to develop new teaching strategies that could eventually be transferred to public schools. The approximately 60 schools operate under looser state regulations than traditional schools, have mostly nonunion teachers, and are run by independent boards that report directly to the state. They have been particularly popular in urban school districts among parents and students frustrated with traditional schools.
…versus "pilot" schools…
Boston created the pilot school concept a year later, with the idea of embracing the innovative teaching methods while avoiding some of the controversies. Unlike charters, the pilot schools are still run by the School Department, which means that the district still receives state funding for each student who attends them. Many school districts across the state have complained that charters drain much-needed resources from traditional schools because the state funding follows the students to the new school.

The Boston's 18 pilot schools also have teachers' unions, although the provisions are scaled back to allow for experimentation with longer school days and other changes that unions have traditionally resisted.

The results are…
The study, being released today at a Boston Foundation forum, examined state standardized test scores for students of similar backgrounds at the three kinds of schools over a four-year period. In the most stark example, charters - independent public schools dedicated to innovative teaching - excelled significantly in middle school math. However, pilots, which have similar goals but are run by the School Department, performed at slightly lower rates than traditional schools, according to the study....

Charter students in middle and high schools showed consistent gains on the math and English exams. The results of pilot schools were less clear. Middle school pilots performed slightly below students in regular middle schools in math and about the same in English. High school pilot performance was a little better, but researchers still deemed those results ambiguous.

The entire Boston Foundation study is available online here.

West Warwick Next in Line

Justin Katz

The school committee in West Warwick appears mainly to be doing the bare minimum to support a Caruolo suit for more money from the town, but it may be headed down the road behind East Providence soon:

The performance audit, commissioned by the town as a part of the Caruolo lawsuit proceedings from the last fiscal year, found that most substantial savings — $14.67 million — in the School Department budget would require concessions from the teachers union or waivers from state and federal mandates.

"These are recommendations for the future and going forward," said consultant Salvatore Augeri. "They could cut some supplies for a couple thousand, but we're not talking millions right now."

But $3.5 million is what the School Department says it needs to finish the remainder of this budget year. Last month, the committee sent the town a letter requesting an additional $3.5 million in operating funds and school officials have authorized their lawyer to file a lawsuit seeking the additional money once all other avenues are exhausted.

Is "the future and going forward" anything like "infinity and beyond"? It seems to me that the school committee has to stop toying around. It isn't enough to publish a list possibilities like "eliminating 16 teachers by requiring the maximum number of students allowed in each class by contract, and cutting 23 other positions that are not required by the state." The committee ought to be bringing that to the teachers' union and explaining that it will happen in the absence of deep concessions.

Night Is Still Night

Justin Katz

Pat Crowley's been working diligently to prove that, when it comes to taxation in Rhode Island, night is day. Yesterday, he stated his starting point thus:

Maybe, just maybe, we are loosing population because we have a cash and carry tax structure that benefits the elite at the expense of the poor, not the other way around as Eddie wants us to believe.

That's kinda tough to square with the fact, gleaned from the RI House's Revenues Facts document (PDF), that the tax share of the lowest group (income under $30,000) decreased from 3.8% to 1.3% from tax year 2005 to tax year 2006, while the tax share of the highest group (income over $200,000) increased from 40.3% to 44.0% over the same period. Crowley notes part of the reason for the shift on the low end:

According to real numbers supplied by the State revenue department, the between 2005 and 2006, the latest number available, the only group to lose population was people earning less than $30,000 a year:
  • Under 30k – (2356)
  • 30k – 50k – 387
  • 50k-75k – 157
  • 75k-100k – 1700
  • 100k – 200k – 4666
  • 200k+ - 987

Of course, it's important to correct impressions by highlighting the fact that these numbers reflect state tax returns, not "population," so a decrease in the lowest group is just as apt to reflect a decrease in the number of households required to file returns as an increase in out-migration. That's especially true during a tax year that saw a 6,976 increase in the number of federal returns showing income under $50,000.

Crowley recently used this state return data to suggest that "before anyone goes crazy thinking our tax structure is what is driving folks out, based on the numbers, not just projections, folks, or at least tax payers, are moving in." IRS migration data, however, tracking taxpayers by Social Security Number, finds definitively a net 3,733 having left the state between filing their '05 to '06 taxes.

To play along, though, if we analyze RI tax returns as closely to adult people as possible (i.e., double-counting joint returns), we find the following:

  • Under 30k – (4160)
  • 30k – 50k – (1402)
  • 50k-75k – (2313)
  • 75k-100k – 2052
  • 100k – 200k – 8502
  • 200k+ - 1860

As I keep saying, the people who are actually leaving are from the upper-working to lower-middle classes. But let's stick with Crowley's collection of claims as he attempts to extrapolate a more specific lesson:

In 2006 there were 491,750 tax returns filed, an increase of 5,541 over the previous year. And even though our collective taxable income rose by $1,044,615,287, we collected $80,281,003 less in income taxes. More filers, more taxable income, less revenue? How is that possible? Well, maybe because of how we structured our taxes?

Neglecting to consider the decrease in low-end tax returns that he mentions elsewhere, Crowley proceeds to shuffle around some numbers that really don't address his own question: How is it possible to gain returns, showing an increase in taxable income, but still collect less in taxes? Well, the answer emerges if we observe that overall tax liability actually increased by $59,667,202. What accounts for the difference is tax credits, which benefited every income category, with increases across the board, growing from $23,255,997 to $163,204,202 from 2005 to 2006. (Albeit, the increases were less in the middle range of income groups.)

Now check this out:

One can say a lot of things about RI's tax structure. Probably not among them is the assertion that taxes are driving out people whose income group receives significantly more in tax credits than it pays pack to the state.

January 6, 2009

The Curse Heard 'Round the World ("Rarely")

Justin Katz

Both the remark and the reporter's presentation are worthy of note in this recent New York Times piece on Israel's movement of ground troops into Gaza:

Another woman found only half of the body of her 17-year-old daughter in the Shifa morgue. "May God exterminate Hamas!" she screamed, in a curse rarely heard these days. In this conflict, many Palestinians praise Hamas as resisters, but Israel contends the group has purposely endangered civilians by fighting in and around populated areas.

The version in yesterday's Providence Journal has a slightly different construction that accentuates the tone:

"May God exterminate Hamas!" she screamed, in a curse rarely heard these days during a conflict in which many Palestinians praise Hamas as resisters but which Israel contends has purposely endangered civilian lives by fighting in and around populated areas.

The grammar has some outright errors, so it could be that the Times subsequently edited its online edition for that reason, but the effect of the original, long sentence was to slither away from a stunning quotation and place its speaker in league with the enemy, against the group for which reporter Taghreed El-Khodary seems to think she ought to have more sympathy.

Consider, too, the insinuation that cursing of Hamas may have been less rarely heard in the past, thus diminishing its astonishing nature. If we admit that it has something new and surprising about it, then we must also wonder whether tides of opinion — of culture — are beginning to turn.

There has, after all, been a prominent example of a nation turning against the terrorists who proclaimed to be fighting for it and to begin the process of restructuring its society in such a way as to join the modern world.

Three Communities Work Towards Consolidation

Marc Comtois

In anticipation of the Governor's address tomorrow, in which it is likely he'll announce some pretty deep cuts in aid to cities and towns, it seems like a good idea for communities to embark on the sort of potential cost-saving projects that Warwick, East Greenwich and North Kingstown appear ready to try (couldn't find link to Warwick Beacon article online):

Consolidation efforts between Warwick, East Greenwich and North Kingstown appear to offer the three municipalities the best of all worlds--reduced costs, improved services and even lower costs for the homeowner.

Mayor Scott Avedisian disclosed last week that talks are being held between the fire departments of the the three municipalities with the thought that Warwick would handle dispatch operations for East Greenwich and North Kingstown. Revenues generated by the service would offset Warwick costs while freeing personnel in the other two departments.

The article goes on to explain that some infrastructure differences still need to be figured out and that, at least in East Greenwich, upgrades to 911 dispatch (for instance) could lead to lower homeowner insurance rates. Hopefully, ideas like these will bear fruit. There really isn't much of an alternative.

Kids Should Take a Year On

Justin Katz

After two drop-out years selling fish off a truck, I returned to college much more motivated, and with a better sense of what I wanted to accomplish there. So I was inclined to approve when I came across a news story with a lede explaining that "more educators are advocating a year off between high school and college to explore options and interests. Frankly, however, I think teenagers would be better served by a year exploring realities than participating in expensive programs such as this:

Longtime educator Karl Haigler, co-author of The Gap-Year Advantage, agrees. "We think that there should be more of a focus on success in college, not just on access to college," he says. That's partly what motivated Princeton University to become the first school to formalize a gap- or bridge-year program. It will be launched in the fall of 2009, starting with 20 students and growing to 100. Students will be invited to apply after they have been accepted to the school. The program will send students for a year of social service work in a foreign country. Students won't be charged tuition and will be eligible for financial aid.

Formal gap-year programs typically cost between $10,000 to $20,000, including living expenses, says Ms. Bull. Students can often apply for financial aid through Free Application for Federal Student Aid (www.fafsa.ed.gov), or look for scholarships and individual study-abroad loans through specific programs. There are also community-based programs, like Americorps, where students receive room and board in exchange for service work and a small stipend.

That strikes me as one part "study abroad" and one part nonprofit labor scheme. What the modern youth needs more than vacations for the conscientious is a year on — a year of attempting to be self-supporting and truly independent from the watchful eyes of professional supervisors and sponsors.

The Supreme Court on Legislative Immunity

Carroll Andrew Morse

Robert Benson's solution, proposed in last Friday's Projo, to the legal question of whether ethics rules can be applied to the official lawmaking activities of legislators presented by the Rhode Island Ethics Commission v. William Irons case…

Why not keep the speech in debate provisions in place except when the legislator is accused of a serious crime or a violation of the state’s code of ethics?
…is entirely consistent with United States Supreme Court jurisprudence on the issue.

As is noted in the Superior Court's opinion dismissing the case against former Senator Irons…

Rhode Island follows the guidance issued by the Johnson and Brewster Courts that legislators may, in particular circumstances, be questioned and prosecuted outside of the legislative chambers.
Johnson refers to the 1966 case of United States v. Johnson; in that case, the Supreme Court had this to say on the issue of the applicability of narrowly drawn ethics rules to legislators…
We expressly leave open for consideration when the case arises a prosecution which, though possibly entailing inquiry into legislative acts or motivations, is founded upon a narrowly drawn statute passed by Congress in the exercise of its legislative power to regulate the conduct of its members.
Thus, even prior to the addition of the 1986 Ethics Amendment to the State Constitution, the Courts had found no "speech-in-debate" prohibitions against the application of ethics rules to legislators. Speech-in-debate immunity therefore cannot be a compelling reason for overturning the Constitutional Amendment now.

Symptoms Ignored in Treatment of a Questionable Cause

Justin Katz

Be sure to read Bjorn Lomborg's op-ed suggesting that excessive and misdirected fervor over climate change is likely to harm many people in the present in order to help a few in the future. The following are a few points that I found particularly interesting:

... implementing the Kyoto Protocol at a cost of $180 billion annually would keep only two million people from going hungry by the end of the century. Yet by spending just $10 billion annually on direct food aid, the United Nations estimates that we could help 229 million hungry people now. For every amount spent on climate policies to save one person from hunger in a hundred years, the same amount could save 5,000 people now. ...

Sea levels are rising, but they have been rising at least since the early 1800s. In the era of satellite measurements, the rise has not accelerated (actually we've seen a sea-level fall over the past two years). The U.N. expects about a 30-centimeter sea-level rise over this century — about what we saw over the past 150 years.

In that period, many coastlines increased, most obviously in Holland, because rich countries can easily protect and even expand their territory. But even for oft-cited Bangladesh, scientists just this year showed that the country grows by 20 square kilometers each year, because river sedimentation wins out over rising sea levels. ...

... famine has rapidly declined over the past half-century. The main deviation has been the past two years of record-high food prices, caused not by climate change but by the policies designed to combat it: the dash for ethanol, which put food into cars and thus upward pressure on food prices. The World Bank estimates that this policy has driven at least 30 million more people into hunger. To cite policy-driven famine as an argument for more of the same policy seems unreasonable, to say the least.

And while your mind is contemplating such matters, see Harold Ambler's detailed exploration of some of the the falsehoods and misleading presentation of the usual "climate change" argument.

More RI Comings and Goings

Justin Katz

Don Roach presents an interesting finding in response to Tom Sgouros's suggestion that "our population loss is as likely to be an affordable housing issue as it is anything else":

The New England Public Policy Center published a report in Jan 2007 noting the percentage of low income families spending more than 30 percent of their income on housing. It would seem the higher this number is the more expensive - relative to each state - it is to rent within that particular state.

The numbers are intriguing and suggest the opposite of what Sgouros argues. There were 69 percent of low income RI renters spending at least 30 percent of their income on rent. That’s a very large number, however it’s smaller in comparison to the 74 percent by other New England states and 83 percent average nationwide. Thus, Sgouros inference falls flat against readily available data. There just is no correlation between affordable housing and falling population rates in Rhode Island.

Finding those numbers was a good thought, on Don's part, but I'm not sure that Sgouros is talking strictly about "low income families." Noting that families are a significant factor in our population loss, Sgouros finds:

I tried correlating the losses with other kinds of survey data about our towns, and wasted an afternoon testing variables like median incomes, per capita incomes, proportion of renters to owners and so on. The best correlation I found was with the ratio of average rents to income. The higher the average rent as a proportion of the average income, the more likely a district is to see enrollment losses. (You can find some of the statistical details and a pretty picture at whatcheer.net.) In other words, the more expensive the housing in a town, the more likely those schools are to have fewer kids today than in 2004. Our population loss is as likely to be an affordable housing issue as it is anything else.

A look at Sgouros's scatterplot shows not only that we're dealing with infinitesimal differences (with an enrollment change range of 0% to -0.2%), but also that the trend is basically a cluster of towns with pretty much the same rent versus median income ratio and urban areas with higher ones. The trendline is straight, as trendlines must be, but it doesn't reflect the plots well. Moreover, Don stands as evidence that people don't typically think of "affordable housing" as meaning middle class homes.

So let's turn, as I've been promising to do, to the U.S. Census data with which Sgouros begins. The first thing to note is that there's been a bit of a turnaround in the following chart from last year's iteration. Here are the latest poverty-ratio changes:

In the year-before period, Rhode Island lost many more high-income households than low-to-mid income households. Perhaps those tax cuts for the rich are working. However, over the long term, we're still losing households that earn more than two times the poverty level:

Basically, my assessment remains the same as after reviewing related IRS data (here and here), and moving on toward actual income data, the argument becomes stronger:

As I've been arguing for a while now, the people leaving aren't the rich and they aren't the poor; they're the families right in that meaty, motivated segment on the cusp of the middle class. Call it the productive class. These folks aren't likely to be looking for "affordable housing" — in the poverty industry parlance — but housing they can afford.

I'm not claiming that housing is not a factor in the RI exodus. Clearly, it's a large consideration when deciding whether to remain in an expensive region with little opportunity. But if it were the central issue — rather than, say, employment — then one would expect our emigrants to be moving nearby, so that they could still work here. According to IRS migration data, only 15% of the households that left Rhode Island during and after the 2006 tax year stayed within the range of abutting counties in Massachusetts and Connecticut. That being the case, if the problem were housing, not jobs, we'd have a lower unemployment rate, because businesses would have opportunities on offer, not filled.

"Affordable housing" programs may be desirable if Rhode Island ever gets its economy back on track, but until then, it would be at best a distraction and at worst a hindrance to the change that really has to be made: Rhode Island needs to become a place in which it is possible to succeed, which means lowering taxes, erasing regulations and other factors that hinder productivity and entrepreneurship, and devoting our limited public funds mainly to infrastructure.

January 5, 2009

Re: Tim Williamson

Justin Katz

I missed part of the conversation, but according to Dan's subsequent paraphrase, Williamson also mentioned draft legislation that would enable local school committees to modify contracts on the grounds that there is simply no money and that would centralize contract negotiation within the state government (the Department of Education, I believe).

Does that strike anybody else as odd? The legislation would simultaneously move contract negotiation to a higher level of government and enable a lower level of government to renege? Either that's incorrect, or something suspicious is going on.

Tim Williamson on Taxes

Carroll Andrew Morse

State Representative Tim Williamson (D-West Warwick) speaking today on the Dan Yorke show (WPRO 630AM)...

There won't be any new taxes. There might be increases to old taxes.
Is the Democratic position on the budget beginning to take shape?

Discouraging the Birth of Business Entities

Justin Katz

While returning, this weekend, to the long-standing question of what sort of official entity Anchor Rising should become, I whittled down my understanding of the relevant tax law to what I believe to be its basic statement: Once one creates an entity, in Rhode Island, that entity is subject to fees and taxation.

An individual can procure from the IRS an Employer Identification Number (aka, a Taxpayer Identification Number) in order to act under an assumed name, and as long as his or her product is not taxable (as via sales taxes), the state need not be involved. Once, however, the business becomes an entity distinct from the individual — whether by joining multiple individuals in a partnership or through the creation of a corporation — various registration fees kick into play, as does the "minimum corporate tax."

The significance of the change is most conspicuous in the cases of pass-through business, such as limited liability companies and S-Corps. As a matter of general taxation, the profits of such businesses are claimed via the income tax filings of partners and owners, but in Rhode Island, they must first shave off the (currently) $500 minimum tax. In other words, even though the business entity itself has no actual income, it must pay $500.

This experience relates to a recent column by Steve Forbes:

... The U.S. has one of the highest profits levies in the developed world: 35% at the federal level, with another average of 5% from state and local taxes. Only Japan has worse. In contrast, Ireland's rate is a mere 12.5%. Imagine the howls from congressional Democrats if Barack Obama were to suggest enacting such a low corporate tax rate in the U.S.

But the accompanying table tells an eye-opening tale: Ireland's corporate tax take as a portion of its economy is higher than that of the U.S. High rates breed pressure for ever more complicated exemptions and ever more ingenious ways to avoid Uncle Sam's tax bite. But an Irish-like rate leaves companies to focus brainpower on growing their businesses instead of on jousting with tax collectors. ...

Mark Steyn seconds Forbes's assessment of tax avoidance and adds the matter of beginning businesses at all:

To a certain type of simple-minded populist, the idea of soaking vast faceless corporations is appealing. But in the end a "corporation" cannot pay tax: The Globocorp corporate HQ looming in chrome and steel over the skyline does not have a pocket to dip into. Like all taxes, the actual cash has to be ponied up by flesh-and-blood human beings - the owners, workers and employees of the corporation. The growing gap between US corporate rates and other developed nations is a massive disincentivization for real human beings to start and grow a business here. And for those already here it encourages the kind of short-term thinking that leads to Bailoutistan and American sclerosis.

It's an easy sell, I guess, to tax a non-human business "entity," but it isn't really possible, because such entities don't exist outside of abstraction. A company is essentially a mechanism within which human beings act, and its construction will be managed to serve the interests of the flesh-and-blood people who use it.

If we at Anchor Rising were to behave rationally, as an Internet-based organization with no manufacturing operations, we'd incorporate elsewhere (for liability reasons) and become The Other Side of Hope in Rhode Island... in Nevada (or wherever). The entity doesn't really "do business" in Rhode Island. With our server in Texas and our incorporation in some other state, in no tangible sense would our advertisers and sponsors be engaging in transactions with a Rhode Island company, even though they'd be trying to reach a Rhode Island audience seeking information relevant to Rhode Island communities, written by Rhode Islanders.

By contrast, if Rhode Island's corporate tax structure didn't entail regular payments from organizations with no income, and if its regular rate were more competitive with those of other states, then rational organizations from other states would have incentive to be "from Rhode Island." Mainstreamers and progressives alike speak often of building up New Economy industries in this state, but they've shown little inclination to acknowledge the incentives to which such businesses — arguably characterized by their ability to locate anywhere — will respond.

Who You Calling Angry!!!

Justin Katz

I was disappointed to come across this musing from Providence Journal Opinion Page Editor Bob Whitcomb (via RI Future):

Why do right-wing radio talk-show hosts like Rush Limbaugh do so well and liberal ones not so well? Consider that Colin McEnroe, a rude liberal, has just been fired by WTIC in Hartford and that national liberal talk-show hosts have had a tough time hanging on to their jobs.

And why do letters to the editor even in liberal states like Rhode Island and Connecticut feature so many right-wingers complaining about high taxes, overspending and allegedly corrupt legislators and so on even as the general electorate elects liberal Democrats by wide margins?

Simple. It's because the conservatives tend to be angrier than liberals and anger is a powerful energizer and seller. Radio stations, all too many of which are owned by a few few national companies, know that they need intensity of listenership above all to sell advertising time. Hiring a right-wing host is a good strategy for selling advertising time.

It's similar to why newspapers devote so much space to sports: Followers of teams are committed readers.

That is not to say that many liberals aren't infuriated, too. Consider the sometimes almost psychotic hatred of G.W. Bush. But, all in all, right wingers tend to be angrier, longer.

There are, no doubt, talk radio hosts who are strikingly angry, but I still have trouble counting Rush Limbaugh among them. The proverbial heavy breathing on Limbaugh is more guffaw than growl; the most strenuous tone is typically stunned amusement at liberals' insanity. The same is true on most talk radio shows. The missing factor in the usual liberal assessment of their heat is the length of the programs, generally with unscripted conversation throughout. Show me the person who can discuss current events with strangers for three hours per day — often reaching down to core ideology — without occasionally raising his voice, and I'll show you a man without beliefs.

If anger plays a role in the disparity in talk radio success between conservatives and liberals, the key isn't the depth or longevity of emotion, but the different modes of expressing it — experiencing it. It's the distinction between a heated rollick that sometimes approaches the push too hard and a passive-aggressive seething. There's a viciousness to liberal anger — made painfully prominent in that "almost psychotic hatred of G.W. Bush" — a wipe-them-out-make-them-irrelevant belittling. Right wing anger is, in its way, more masculine; it pounds on the front door, bloodies the lip, and leaves as if the point's been made. That sort of anger, because visible in advance, can be talked down, soothed, whereas the other sort of anger slides the knife in and out with mute certainty.

But I wonder if even that much explanation is necessary. It might be more productive to chart ideological leanings demographically and align media by occupation. NPR's major non-music shows align with commutes. The king of conservative talk radio covers the after-lunch span of the work day. Perhaps the critical factor is the political norm among those who can talk — and listen to talk — while they work.

The thread is continuous across these various points, weaving a picture of masculine sparring, most often of a good-natured tone, among men whose hands are occupied more than their minds at work. Of course there are broad exceptions (pun intended or not), but it is the vast average of a group that will spell success for a daily show.

As for Whitcomb's association of talk radio with letters to the editor, well, I imagine Bob designates the political inclinations of writers based on the topics that they raise. Letters don't come, like mine, marked with a "conservative" stamp. Therefore, I'd expect letters complaining about "high taxes, overspending and allegedly corrupt legislators" to be especially common in liberal states, in which at least the first two qualities are a matter of principle.

Taking Wealth Morally

Justin Katz

By all means, let's declare the immorality of gargantuan wealth. Every story of catastrophe and dire need must make the rightly ordered person marvel at the spiritual putrefaction of those who hoard their millions and billions. How could a man of clear conscience sift money idly through his fingers in such sums as could effect salvation for untold thousands? How detrimental to a woman's soul to ignore those who suffer in her time while she looks across potentially infinite generations of her own progeny who will be freed from the necessity of earning.

Let's not be squeamish in admitting the ugliness of even the passive greed that allows wealth to amass in obscene amounts under one's name, as if it jangled together by some sort of natural force of economic gravity. Let's assert a moral duty to cast those riches back out into the economy as both a charitable and a productive force.

But what then?

Inasmuch as the actions that lead to wealth — earning, investing, saving — are not immoral (indeed, are generally positive), the community's legitimate complaint is of the excessive proportion. Hoarding amounts that could never be spent is an iniquitous triviality when weighed against mouths that are never fed. On the other hand, the accumulation of vast wealth enables a higher degree of risk in investment, whereby society can benefit from the gamble, and a higher degree of conservation of property, whereby possessions that might otherwise be divided and drained are instead preserved. The initial difficulties, therefore, are determining how we ought to balance competing goods and who ought to be empowered to pass judgment.

In his May 25 op-ed in the Providence Journal ("The immorality of private wealth"), retired Superior Court judge and current law professor Stephen J. Fortunato, Jr., cites the amassment of wealth among such other "immoral" activities as "murder, rape, theft," running red lights, violating OSHA standards, "muggings and convenience store holdups." Moreover, his prescription is not the social opprobrium with which we might respond to an adult who whispers obscenities to children, but high taxes on the rich by a government with "a redistributive and a regulatory role." In short, the aptly named jurist unsurprisingly treats immorality and illegality as if they ought to be equivalent.

Thus, in answer to the above-described difficulties, Fortunato puts forward our representative democracy as economic arbiter. The government will decide how much is too much for what purposes. Our legislative, executive, and judicial triumvirate will draw a line above which elected and appointed officials allocate the appropriate usage of monetary wealth — this much to conserve open space, this much to support research, this much to preserve arts and culture, this much toward the welfare of our society's poor.

Unfortunately, with money flowing along this path, the difficulties can only compound. Previously, the transfer of wealth involved the relatively simple transaction of a provider's persuading a consumer to part with dollars, whether for luxuries, investments, or the emotional balm of charity. Now, the government has translated the wealth into power — greatly magnified by its aggregation — and muddied the judgment of its dispersal.

Parties begin to petition government officials to expend the public largesse on their preferred goods. The petitioners convert some of the power back into cash by way of campaign contributions or other perks of office (or perks available upon leaving office). They may promise moral gratification and burnished legacies. They may concentrate the flexed muscle of voters.

None of which is immoral, of itself, but observe what has happened: The economic power that exists naturally in any society has been overlapped in the same stratum as the legal and police power with which we vest government. The same segment of the community that can, to some degree, dictate behavior under threat of criminal prosecution can increasingly manipulate economic behavior under threat of regulation and confiscation. The one entity empowered to take money by force is increasingly a source of money for politically powerful lobbies.

In short, the point at which power and money flow together has greater gravity for corruption, and there is less independent power (in the form of independent wealth) counterbalancing it. Worse still, to the degree to which money is power, those with more are the ones ultimately increasing their control as the government asserts authority over the flow of capital and the determination of what and whom to tax and regulate.

So yes, let's conspire to take money from the rich and spread it across the society, but let's consider the possibility that the only way actually to accomplish that end is to empower those in lower economic tiers to take the wealth for themselves — not by force or democratic assertions of power, but through persuasion, production, and competition, which is to say through freedom and economic ingenuity.

January 4, 2009

Reason Corrupted by Evil

Justin Katz

I have to believe that the day will come when society at large will share my disgust with such phrasings as Owen M. Sullivan's and be astonished that anybody would commit them to print, much less seek to publish them in major newspapers:

The Israeli attack on the Gaza Ghetto, much like the Nazi attack on the Warsaw Ghetto, is in the words of Israeli leaders "the beginning" and is intended "to send Gaza back decades."

So far hundreds have been killed and over 1,000 injured, with many women, children and elderly along with many homes, police stations and civil-society buildings destroyed. According to the Al Mezan Center for human rights, most Gaza Ghetto victims, like Warsaw Ghetto victims, are civilians. And just like the Nazis who tormented those in Warsaw, the Israeli government blames the victims. Enough!

It could be, I suppose, that all of my history books were missing the pages about anti-German terrorism fomented from Jewish neighborhoods (or, actually, mislabeled such stories as Nazi propaganda, rather than accurate reportage), as well as accounts of the German Jews' comparable behavior to this:

The Hamas government has placed dozens of Fatah members under house arrest out of fear that they might exploit the current IDF operation to regain control of the Gaza Strip.

The move came amid reports that the Fatah leadership in the West Bank has instructed its followers to be ready to assume power over the Gaza Strip when and if Israel's military operation results in the removal of Hamas rule.

Fatah officials in Ramallah told The Jerusalem Post that Hamas militiamen had been assaulting many Fatah activists since the beginning of the operation last Saturday. They said at least 75 activists were shot in the legs while others had their hands broken.

Wisam Abu Jalhoum, a Fatah activist from the Jabalya refugee camp, was shot in the legs by Hamas militiamen for allegedly expressing joy over the IDF air strikes on Hamas targets. ...

Meanwhile, sources close to Hamas revealed over the weekend that the movement had "executed" more than 35 Palestinians who were suspected of collaborating with Israel and were being held in various Hamas security installations.

What a strange, nasty world the likes of Sullivan must inhabit. Pity them, for they will surely tune out evidence of the corruption that evil has managed in their minds.

A Quick Explanation for Pat

Justin Katz

I haven't had a chance to work through my Sunday paper, yet, so I'll offer no comment on the bulk of that to which Pat is responding in this post, but he does construct a question in such a way as to merit correction. Arguing for increasing taxes and government-induced costs of doing business in Rhode Island, he writes:

Let me ask the business folks reading: is it a successful business model to lower your prices year after year even if your production costs rise each year? I mean, you want to run government like a business, right?

The flaws in these questions are multilayered, but the core error probably comes with Pat's failure to account for the fact that much of what Rhode Island "produces" — and therefore much of its expenses — is separate from the activities that bring in revenue. Businesses will not relocate to Rhode Island based on its social safety net, for example. As for items of direct utility to businesses and productive residents — such as transportation infrastructure — the insidious tendency of modern government is to treat them as additional to general expenses, with annual bonds and supplemental fees and taxes.

The next most significant error centers on the related implication that the government's "goods" are limited and distributed in a "one per customer" fashion. If the government is to be seen as a business, most of its products are actually services, and the incremental cost of accommodating an additional customer is minimal. Adding a few cars to a highway's burden doesn't affect the cost of maintenance tasks and barely affects the frequency, yet the increased revenue of several new residents working for a productive company is likely to be significant.

In this regard, the state-as-business is more like a movie theater. The costs associated with acquiring the films, maintaining the building, and offering concessions may be going up, but if the owner finds that fewer customers are taking in the flicks, and that those who do come buy less popcorn and soda, every year, increasing the price of tickets is not a very farsighted strategy. Rather, the owner should pare down expenses not related to revenue, streamline excessive costs (e.g., if there are more ticket-rippers than attendance justifies), and redirect resources toward changes that might attract more viewers — whether that means upgrading the seating or offering discounted Jujubes.

In reality, what government entities such as Rhode Island seem to tend toward is a shifting of their "business model" toward a focus on the expenses column as their core purpose. It becomes less their business, in other words, to foster a wealthy, secure, and productive society, and more their business to mandate charitable services for the unproductive and to protect and advance the wealth and security of public-sector employees. The state undertakes to increase "production costs" (to use Pat's phrase) as its raison d'etre.

Retiring England and New England, Alike

Justin Katz

The editorial board of the Providence Journal notes a familiar problem in the old country:

Last month, Britain's biggest business group, CBI, released a report contending that the total liability for public pensions in the country had reached at least a staggering 900 million pounds — about $1.4 trillion. Some 5 million unionized public employees in Britain may retire at 60, at two-thirds of their highest salary, while 21 million private-sector employees face much less plush retirements, and the prospect of working (if they are lucky) until 70 to make ends meet.

Of course, there are myths and statistical imbalances to be overcome if the untenable situation is to be remedied:

The public employees contend that they get plush pensions in exchange for earning less than their private-sector counterparts. But a study by the Office for National Statistics found that isn't true; public employees received higher pay than those in the private-sector at all but the highest levels.

Under the Labor Party, the number of public employees in Britain exploded by more than 23 percent between 1998 and 2006, while private-sector employment — which covers most of the cost of government — inched up only 3.3 percent.

Creeping socialism begins to look like a concerted plan, doesn't it?

Hashing out New Media/Old Media Roles

Marc Comtois

Justin explained in his Newsmakers appearance one potential method by which the "old media", newspapers (like the ProJo) in particular, could recalibrate and take advantage of the forum that bloggers provide (basically for free). To summarize, let the MSM focus on collecting news and the blogs deal with the discussion of the news . Glenn Reynolds provides one example of the benefits of one such relationship:

[T]he relationship between blogs and Big Media should be thought of as symbiotic rather than competitive, and here’s some more evidence. Jack Lail, managing editor of the Knoxville News Sentinel, emails that InstaPundit sent them nearly a million pageviews last year, and holds two spots (for instapundit.com and pajamasmedia.com/instapundit) on their list of top 20 referrers. Smart news people — like Lail — are more interested in getting bloggers to deliver traffic than in complaining about blogger competition. And smart news organizations will take advantage of new technology to facilitate their hard-news reporting ability via the “Army of Davids” approach, rather than complaining that people who post breaking-news reports on blogs or Twitter don’t have journalism degrees.

It’s interesting to me that we see far more anger from Old Media folks aimed at bloggers, etc., than at Craigslist, even though Craigslist has done far more economic harm to the newspaper industry than bloggers, who probably add eyeballs rather than (as Craigslist does) subtracting them. My suspicion is that the Old Media folks care more about prestige and position than money, and bloggers have hurt them in the prestige and position department. Of course, caring more about prestige and position than money isn’t a formula for a flourishing business . . . .

Meanwhile, here’s more on how bloggers and Big Media can work together in covering an issue.

The Playground of Ideas

Justin Katz

A response that Newsmakers host Tim White made to me during the latest episode of his show (channel 12 at 5:30 a.m., channel 11 at 10:00 a.m., and online in two parts here and here) struck me as worthy of further discussion. Ian Donnis asked about the "vitriol" in blog comment sections, and I answered, in part:

One of the things I do like about the medium in general is you really can bring it back to a sort of basics of interpersonal relationships. What I mean by that is you ignore somebody who's being snippy, and they'll stop, if everybody starts to gang up on them, and if it gets really bad, you can ban them.

To which Tim White suggested:

That's kind of a high school playground mentality. Is there any filter; do you read a contribution to your site before posting it, or is it raw?

The curious consequence of White's formulation is that it casts learning to interact without hierarchical supervision as the juvenile method, and submitting to an official hand to "filter" discussion as the — I guess — mature and civilized route. Without extrapolating an extemporaneous statement to global ideological realities, it's possible to see in this reversal the inclination to seek ever more central authority.

That's a profound question: Is it a higher mode of being to mutually reinforce a set of abstract standards, or to rely upon a chosen group of human individuals to dictate behavior? Obviously, I'd argue for the former (and in a way that integrates with the Catholic Christianity to which I strive to adhere, if anybody wishes to take the discussion there), and I'd further suggest that what Tim characterizes as a "playground mentality" is actually the set of grown-up rules that we try to impose upon youthful interactions. Adults tell the kids to ignore the troublemaker or jointly express disapproval (and to accept him if contrite and cooperative), rather than allow them more primal means — such as throwing rocks to drive him off.

In a playground for adults, the need to have somebody on recess duty would ideally be minimal, and his role, in any case, ought to be to guide toward better behavior, not to censor and punish.

January 3, 2009

Re: Gas Tax Increases Are Coming Down the Road

Justin Katz

I think what I find most distressing about the reports of potential transportation-related tax increases that Marc mentioned this afternoon is that nobody is even hinting at the possibility of increasing money for such a basic government function as transportation infrastructure by taking it from less fundamental government functions. (Pick your favorites.. or rather, your least favorites.)

Of course, I don't intend the above to detract from the plethora of other distressing factors. Take, for instance, the fact that a strategy of increasing taxes to compensate for revenue lost because of conservation shifts the burden directly to those who cannot conserve — namely, folks who must use gasoline directly or indirectly in support of their jobs. If a lowly carpenter like me must bear more of the burden of fixing our roads because I have no choice but to drive my van full of tools for at least an hour-and-a-half per day, then prices will go up across the economy, and competition will go down.

Then, of course, there's this:

According to a draft of the financing commission's recommendations, the nation needs to move to a new system that taxes motorists according to how much they use roads. While details have not been worked out, such a system would mean equipping every car and truck with a device that uses global positioning satellites and transponders to record how many miles the vehicle has been driven, and perhaps the type of roads and time of day.

That such a notion would make it beyond a mere thought spoken out loud during a meeting indicates the dangers that our freedoms face in the future. Just as there will always be an excuse not to shift government expenditures from extras back to essentials, there will always be a reason that our liberty — notably our liberty of movement — can be circumscribed just a little bit more tightly.

Red-Light Cameras' Green-Light

Justin Katz

Despite a lack of evidence (as far as I'm aware) that red-light cameras have any reductive effect on accidents and questions about whether they even turn a profit for the controlling authority, the General Assembly eliminated the sunset provision to their allowance last June, and the change went into effect without the governor's signature. Happenings and controversies in Houston should perhaps dissuade localities from jumping into the game:

Accidents more than doubled at the Houston, Texas intersections where red light cameras are installed, according to a study released Monday by Rice University and the Texas Transportation Institute (TTI). This result posed a dilemma for TTI and the city of Houston which had requested the study. Houston Mayor Bill White was furious when he saw the report's draft text in August. He banned the document from publication and ordered a re-writing of the text that would reflect a more positive result. To accomplish this task, White was able to turn to the study's primary author, Rice University Urban Politics Professor Robert Stein. Stein's wife, Marty, is employed by the city of Houston as a top aide to the mayor. Stein's newly revised report now concludes that "red light cameras are mitigating a general, more severe increase in collisions."

So, not only do red-light cameras appear to increase traffic accidents, but they can become a lubricant for political corruption and deliberate manipulation of public research. Not a catalyst that would be wise to expand in our corrupt little corner of the nation.

The report's authors achieved the turnabout, by the way, thus:

To achieve the appearance of success, the study divided red light camera intersections into "non-monitored" approaches — the directions of travel at the intersection where the red light camera is not looking — and the "monitored" approaches where ticketing took place. There was a 132 percent increase in collisions at the non-monitored approaches of the intersection where red light cameras were installed and a non-significant 9 percent increase at the monitored approaches. The study treated these increases in both rear end and T-bone collisions as unrelated to the red light camera as long as the accident happened outside of the camera's view.

Frankly, I suspect that a broader study would find a greater increase in accidents, as the mere possibility that traffic lights have cameras increases accidents even at intersections that have none.

Chariho Fiefdom Temporarily Suspended

Justin Katz

Apparently powerful players on local school committees can't just subvert the will of voters without providing the public any warning that they intend to do so:

Superior Court Judge O. Rogeriee Thompson has ordered the Chariho Regional School Committee to reinstate William Felkner until it properly votes on whether to allow him to serve on the school board while seated as a member of the Hopkinton Town Council.

Thompson enjoined the school board from enforcing its Nov. 18 decision, based on a finding by Chariho Solicitor Jon M. Anderson, that when Felkner took the oath of office as a Town Council member the evening before, he in effect gave up his seat on the School Committee.

Although the Nov. 18 school board meeting was properly advertised, there was no public notice that the board was considering a vote on whether Felkner could continue to serve.

Assuming that public light doesn't cause Chariho School District lawyer Jon Anderson — and whoever's prodding him — to recede into their hovels to scheme for another day, manipulating the system by other means, it would behoove Rhode Islanders interested in fair dealings and sane reforms to attend any duly advertised meeting at which the dabblers in conspiracy may attempt, again, to deny voters' right to elect whom they like for local offices.


As a side note: Doesn't the Providence Journal have anybody on staff who could provide some sense of where the relevant law actually stands when it comes to simultaneously holding the two particular offices to which Bill has been elected? I'd gladly do the research, if I had time, but it seems to me that such contributions to news stories represent an area in which a state-level newspaper would be well positioned to provide an added value worth paying for.

Gas Tax Increases are Coming Down the Road

Marc Comtois

Proving yet again that unintended consequences occur from government policies, we're hearing noise about increasing the gas tax at both the state and federal level. The reason? We're driving less, conserving fuel and helping the environment as we've been urged to do. But now we're not buying enough fuel to generate the "revenue" to pay for highways and the like. The innovative solution being carted out is more taxes. First, nationally:

The 15-member National Commission on Surface Transportation Infrastructure Financing is the second group in a year to call for increasing the current 18.4 cents-a-gallon federal tax on gasoline and the 24.4 cents-a-gallon tax on diesel. State fuel taxes vary.

In a report expected later this month, members of the infrastructure financing commission say they will urge Congress to raise the gas tax by 10 cents a gallon and the diesel tax by up to 15 cents a gallon. At the same time, the commission will recommend tying the fuel tax rates to inflation.

The commission will also recommend that states raise their fuel taxes and make greater use of toll roads and fees for rush-hour driving.

Well, Rhode Island is ready to follow suit:
The proposals include increasing the gasoline tax, now 30 cents, by up to 15 cents per gallon by 2016, which would raise an estimated $64 million per year. They also include a new “petroleum products gross earning tax,” beginning with the equivalent of 10 cents per gallon of gasoline in 2010 and adding another 5 cents in 2014. That would affect all petroleum products, from gasoline and aviation fuel to those made from petroleum derivatives, such as plastics, paint and fertilizer. It would eventually raise about $66 million per year, the draft report says.
At the state level, the gas taxes haven't actually gone toward what they were supposed to--roads and infrastructure. Instead, they've been lumped into the general fund and all highway renovation has been bonded. (We've gone over this a million times). Given this track record, how can Rhode Islanders be assured that "this time is different"?

Wherego the Impressions Goes Public Opinion

Justin Katz

Union members and supporters in Rhode Island should contemplate hard where their self-imposed imperatives are placing them in the battle of messages. On their side is a dogged assertion that official processes don't weaken their hand even during financial emergencies:

[Union lawyer John] Leidecker also said state law says districts should adhere to the old contract until a new one is executed, and there aren't exceptions for a fiscal crisis. In addition, he said the committee members' decisions yesterday "further indicates their disdain for the process," particularly the arbitration process, which produced a "fair settlement."

It's understandable that the union would take that line; they've managed, over the years, to hone The Process in their favor, after all. However, regular folk tend to turn against tilted processes when they collide against reality and reason:

Mayor Joseph Larisa said: "East Providence is flat broke. The big labor contract that finally expired was as outrageous as it is unaffordable. Now that the damage has been done, the options left are a crazy 15 to 20 percent property-tax increase against our hard-hit taxpayers, bankruptcy or finally setting reasonable and fair compensation for all school employees. There is no fourth option.

January 2, 2009

East Providence Charges into the New School Year

Justin Katz

So states East Providence School Committee Chair Anthony Carcieri in a press release just out (and available in full in the extended entry):

"This school system has cut everything to the bone except the teachers' contract. Everything," Carcieri said. "They stopped capital improvements years ago. Basic maintenance of the school buildings has all but stopped. We've been ordered to replace about 70 doors for safety reasons, and there's no money to pay for it. We have no extras in our educational program. We've had expert after expert look at this. There is no place left to cut except our biggest account — teachers' pay. I hope they'll understand that this is nothing we want to do. We have no choice."

In a letter to the NEA's Jeanette Woolley (PDF), School Committee Lawyer Daniel Kinder notifies the teachers' union of several changes that the committee "must, and will, implement... effective Monday, January 5, 2009 at 12:01 a.m." Included is no pay increase, a 20% contribution to healthcare premiums for all active teachers and all retirees on or after November 1, 2008, and other healthcare-related provisions. Chief among those is not only the complete elimination of the buy-back provision (previously over $5,000 for declining coverage), but the addition of the following language:

No employee or retiree shall be eligible for either family or individual health coverage or family or individual dental coverage if the employee or retiree has available to him/her alternate coverage from another source, whether from another employer, a spouse's employer, a governmental entity, or otherwise. Thus, for example, without limitation, if an employee's spouse is employed by an employer who maintains a group health insurance plan that includes family or spousal coverage, the employee is not eligible for coverage under the East Providence Schools group plan. Similarly, without limitation, Medicare eligibility or a teacher's employment by an employer who maintains a group health insurance plan would also render the teacher ineligible for coverage pursuant to the East Providence School Department plan. Each employee and retiree claiming eligibility for health insurance coverage pursuant to the School Department's plan shal be required each year to provide the School Department with an affidavit in form satisfactory to the School Department, averring under oath and penalties of perjury, that the teacher does not have available to him/her health insurance and/or dental insurance from any source other than the School Department.

In short, any teacher who can get coverage elsewhere must do so. Note the absence of any weasel language like "comparable."

The teachers in East Providence and throughout Rhode Island must come to realize that their union has served them extremely poorly by:

  1. Failing to accurately assess the financial realities of the state and towns, and/or
  2. Promising the possibility of endless advances via hardball negotiations.

The state's been pushed off a cliff, and it is time for unionists and other riders of Rhode Island's apocalpyse to reorient themselves toward reviving our drowning society.

Press Release
January 2, 2009
Anthony A. Carcieri
Chair, East Providence School Committee

The East Providence School Committee announced today that it will roll back a nearly-5% pay increase granted to teachers in May 2007, and begin charging teachers 20% of the cost of health insurance, effective on Monday, January 5. Also gone will be a controversial "buyback" program, in which teachers have been paid over $5,000 per year if they received health insurance from their spouses' employers.

"Desperate times call for desperate measures," said Anthony A. Carcieri, School Committee Chair. "On October 31, we had $4.5 Million in bills we couldn't pay. It's only gotten worse since then. If we don't stop the blood loss now, we'll owe $9 Million next October, and the schools will simply stop functioning. This is a death spiral. We've got to stop it."

The School Committee and the East Providence Education Association ("NEARI") reached impasse in negotiations for a new labor contract on October 29, two days before the last contract expired. Despite mediation by state-appointed mediator Bernard Singleton, the Union called off further talks, insisting that it could not agree to a package of concessions that would save the School Department $3 Million in the fiscal year beginning November 1, 2008.

The Union did make a verbal offer of concessions it said would save the School Department about $1 Million. "We costed out their proposal and it was a very bad deal for taxpayers. The actual savings this year would have been non-existent. The so-called "$1 Million savings" was simply a deferred pay raise and $330,000 in contributions to health insurance premiums. Even with the health insurance savings, because of other increases in the proposal, the School Department's FY09 teachers' contract costs would have increased over FY08 costs by about $800,000. Further, the proposal would have really socked it to us in the second year, when two pay raises within a month would have jumped our costs by another $2 Million," Said Jerome Baron, Finance Director for the school system. "Even if they had offered $1 Million in real savings, that wouldn't have done it. There's nowhere to get the rest of the money."

East Providence's 500 teachers are the only public school teachers in Rhode Island who have never contributed a cent towards their health insurance premiums. Their pay amounts to over $33.2 million, better than $65,000 per full-time and part-time employee. That pay will drop to $31.7 Million on Monday, a 4.88% reduction, so the average pay will still exceed $63,000 per year. Full-time teachers work only 181 days per year, less, on average, 8 sick days and two personal days per year.

The new cost saving measures are only the latest in a series of steps taken by the School Department. In November 2008, bus aide positions were eliminated, with a private contractor taking over and saving the schools $549,000 per year. Last year, custodians agreed to a package of contract concessions that made them the first school employees to contribute to their health insurance premiums.

"This school system has cut everything to the bone except the teachers' contract. Everything," Carcieri said. They stopped capital improvements years ago. Basic maintenance of the school buildings has all but stopped. We've been ordered to replace about 70 doors for safety reasons, and there's no money to pay for it. We have no extras in our educational program. We've had expert after expert look at this. There is no place left to cut except our biggest account – teachers' pay. I hope they'll understand that this is nothing we want to do. We have no choice."

Rhode Island law prohibits school committees from spending more than they are allocated by city, state and federal funding sources. In October, the School Committee submitted a budget to the City Council that would have paid off the $4.5 Million debt and ended the `08-`09 year without a deficit. It was $9 Million higher than the City's allocation, and required tax increases that exceeded those permitted by East Providence's Charter and by state law. The City Council rejected that budget, and instead provided the schools with a $400,000 increase over last year – a year in which costs exceeded income by $3.5 Million.

The School Committee filed a so-called "Caruolo" lawsuit against the City in October, in an effort to force it to begin paying last year's bills.

"Those lawsuits make no sense," said Committee member Steven Santos. "The taxpayers pay $200,000 to a lawyer for the City and $200,000 to a lawyer for the schools, and what's the result? The taxpayers still have to find a way to cover the debt, and now its $400,000 bigger. We should be good enough to work it out without any lawsuit. I'm sure that will be high on both the School Committee and the City Council's agenda in the new year."

With a projected deficit this year of over $4.2 Million, the trimming of costs is not finished. The East Providence Taxpayers' Association last week sent a letter to School Committee members demanding to know how it would close the budget gap if it reduced teachers' compensation by only $3 Million.

"I hope everyone will stay calm," said Carcieri. "The teachers and the taxpayers need to know that we are working on problems that were created over many years. We're attacking those problems. We are not attacking the teachers or the taxpayers. Give us a chance."

Mario Cirillo, Superintendent of Schools said, "We have to escape this detrimental financial cycle. Our administrative staff is one of the smallest – probably the smallest – of any school district of this size in the northeast. We should be focusing all of our efforts on improving our teaching, improving our curriculum, helping our kids to be better equipped to succeed in the 21st Century. For example, we should be thinking about teaching computer skills, but that's just out of the question. Instead, we are focusing too much of our time on trying to figure out how we're going to afford to pay our special providers for our special-needs kids next month. This can't go on."

The Look of "Balance" in the New Year

Justin Katz

It isn't my intention, with this post, to gripe about not being included on a list in which we'd be in awkward company, but I do think it worthwhile to point out that Crowley's "Rhode Island Blog Round Up" probably gives a better sense of the truth than declarations by a man who considers them cheap indeed:

... if the blog is going to continue to be a success, people who still need to be convinced will have to be welcomed into the conversation.

... While the Projo has layers of editorial review, local TV has too little time for in depth discussions, and talk radio is more bluster than brains, RIFUTURE is a place for people of all political stripes to take their message directly to the people.

In true lefty fashion, Crowley can be expected simply to move the boundaries of which political stripes are fit for civilized discussion.

What Should Be Asked During the RNC Chairman's Debate?

Carroll Andrew Morse

On Monday, the Americans for Tax Reform organization will be holding a debate between the candidates for chairman of the Republican National Committee. Confirmed participants are Saul Anuzis, Ken Blackwell, Katon Dawson, Chip Saltsman and Michael Steele. Also inivited, but not confirmed the last time I checked the website, are Mike Duncan, Tina Benkiser and Jim Greer.

At least part of the debate will be devoted to questions submitted and voted on via the RNCDebate.org website set up for this event. Rhode Island's own Jon Scott has submitted the following question for consideration…

The NRSC and NRCC have concentrated solely on incumbents during the last several cycles and have been ineffective. We have had no discernible answer to the DNC's "fifty state strategy". Good candidates are hard to attract and money is the mother's milk of politics. As a two time candidate for US Congress in Rhode Island; the bluest of blue states, I want to know what the contenders' plans are to support federal races and state Party mechanisms in "weaker" states.
If you'd like to see Mr. Scott's question put to the candidates, you can vote for it by clicking here (registration required).

On Television, Sans Haircut

Justin Katz

I'm a guest on this week's Newsmakers show, talking new media stuff with host Tim White, Ian Donnis, and Matt Jerzyk. The show airs on WPRI (channel 12) at 5:30 Sunday morning and Fox (channel 11) at 10:00 a.m., and you can watch it at your leisure already online (part 1 and part 2).

To put questions of style to rest, I'd like to note that, with the holiday, I didn't have a chance between notification and taping to get a haircut.

A couple of cliché busters are Matt and I.


I had an issue with each of the online parts cutting out about two-thirds of the way through and have received email letting me know that it wasn't just me. If you pause the show just after each commercial has finished and let the video download completely (the timeline bar will fill up), you should make it through to the end.

Feeding the Watchdog

Justin Katz

And here, beginning in Connecticut, comes the reasoning that many suspected would arise for a mainstream media bailout:

"I truly believe that no democracy can remain healthy without an equally healthy press," said Fiedler, now dean of Boston University's College of Communication. "Thus it is in democracy's interest to support the press in the same sense that the human being doesn't hesitate to take medicine when his or her health is threatened."

Professor Fiedler's error is one of mechanism: The appropriate manner in which a democracy supports its press is via freely willed financial support, and the way the press ensures such support is by giving citizens what they want and need. If the government props the press up, then it will not make necessary corrections as it continues down a path of bias and unnecessary fluff.

What the media needs is to sharpen its tools and hone its core capabilities — remembering that "gathering news" doesn't mean snatching reports from wires and larger newspapers, but actually going out and developing fresh information of interest to the paper's concentrated audience. It's difficult work, no doubt, and may not employ as many people as the newspapers have hired previously, but it's the only viable route for a successful and independent industry.

The promise of government — in line with Thomas Sowell's observation that politicians pledge the impossible — is of ease, but Quinnipiac journalism professor Paul Janensch puts it well when he says, "You can't expect a watchdog to bite the hand that feeds it." In the media's case, the easy way out is an impossibility. Ultimately, readers will know it's a fraud, and they'll turn to alternatives such as the Internet, even though hobbyists' news gathering resources are clearly inadequate.

Stop "Unethical, but Legal"

Justin Katz

Robert Benson, first vice president of Operation Clean Government, calls for outrage over Superior Court Judge Francis Darigan's ruling that legislators cannot face consequences for votes cast in response to bribes:

This is not just some arcane legal conundrum of little interest to most Rhode Islanders. Darigan's decision essentially guts the state's Code of Ethics and leaves the Ethics Commission powerless when legislators violate this code. His decision is based on a 200-year-old "speech in debate" clause in the Rhode Island Constitution that protects members of the General Assembly from reprisals for their legislative actions. Article VI, Section 5 of the state's constitution says, "For any speech in debate in either house, no member shall be questioned in any other place." Judge Darigan believes this sentence trumps a 1986 amendment to the state Constitution that created the Rhode Island Ethics Commission precisely to deal with abuses of office by public officials.

Article III, Section 8 of the Rhode Island Constitution states, "all elected and appointed officials and employees of the state and local government, of boards, commissions and agencies shall be subject to the code of ethics." The key word is all — it means members of the state General Assembly House and Senate as well as all other elected officials. This amendment further states, "The ethics commission shall have the authority to investigate violations of the code of ethics and to impose penalties, as provided by law."

Unfortunately, I'm not sure that Rhode Islanders do outrage — at least not against political corruption. The state's too intertangled with itself; too many backs are being scratched. The pessimist in me concludes that the state will not begin to turn itself around until the various interest groups begin to battle each other, rather than the taxpayer. Of course, the interest groups (unions, poverty industry, Democrat partisans, and so on) have developed an overlapping hierarchy that will resist internal competition as long as possible.

But then, I tend to be an optimist, which leads me to agree with OCG founder Bruce Lang that "Rhode Island can be one of the most successful states in the United States," and that a positive message, backed by concerted effort and strategic cooperation can implement specific changes to the law, such as the three that Lang lists:

1. Reduce the size and cost of our governments in every possible way — by eliminating and consolidating many jobs, government services, government departments and school systems.

2. Improve the illegal-immigration situation, which must be costing our state at least somewhere between $200 million and $400 million per year.

3. Not only can we not increase taxes, if we are going to become competitive as a state we must begin (even if takes years) to reduce taxes, such as estate and certain corporate and individual income tax rates.

Increasingly, I'm persuaded that the ultimate determinant of reform's success will be the opposition movement's ability to get its act together. That'll mean putting egos aside, elevating the goal above the process, and refusing to let the forces of the status quo amplify our differences beyond both.

The Lesson Never Learned

Justin Katz

Partisans may attempt to yoke each successive American administration with part of the blame, but it's achingly frustrating to note the repetitive nature of events and rhetoric in the Middle East. Jeff Jacoby enunciates the lesson that the West never wants to learn about terrorism:

The hard truth is that no matter how much Israelis crave peace, they cannot achieve it through concessions and compromises and "road maps" - not when their enemies view such overtures and agreements as signs of weakness, and as proof that terrorism works. For 60 years, Israel has had to contend with the hostility of its neighbors and the heavy costs of war; its yearning for peace is understandable. But there will be no peace without victory, and no victory without fighting for it.

For a long time now, Israel's leaders have resisted this fact - "We are tired of fighting," Ehud Olmert infamously declared in 2005. For 15 years, beginning with the sham of the Oslo peace process in 1993, Jerusalem has tried to appease its way to tranquility. It allowed Yasser Arafat and his PLO killers to take control of the West Bank and Gaza. It embraced the goal of Palestinian statehood. It responded to terrorism with ever-deeper concessions. It abandoned Lebanon and Gaza. It reiterated, over and over, the false mantra that "you make peace with your enemies." And from the ongoing captivity of Gilad Shalit to the rockets slamming into Israeli cities to the dysfunction and radicalization of Palestinian society, the results have been disastrous.

Change a key figure here. Choose a slightly different front-group there. And Western diplomats will leap again and again for the golden ring of painless resolution. Time and again, though, they find, when they pause for breath, Islamists stoking hatred and cutting throats.

January 1, 2009

Pork for the Union

Justin Katz

Michelle Malkin's looked through some of the expenditures of the UAW, which via auto-industry bailouts, is now under the care of the federal government:

In February 2000, the union poured $14.7 million into Pro Air, a Detroit start-up airline that, well, didn't get off the ground. Plagued by safety problems, the feds shuttered the company less than a year later. The union didn't fare much better in its venture with a liberal radio network. In 1996, union heavies got the bright idea to invest $5 million in United Broadcasting Network, a left-wing precursor to Air America that the UAW hoped to use to spread its corporate-bashing propaganda. They shelled out for a $2 million, state-of-the-art studio in Detroit and incurred years of losses of a reported $75,000 a month before closing the network down in 2003.

And while the UAW and carmakers cry poor, they've operated massive joint funds for years that have paid for lavish items such as multi-million-dollar NASCAR racer sponsorships and Las Vegas junkets. The dire economic downturn hasn't changed the behavior of profligate union bigs at the front office or the shop floor. Local Detroit TV station WDIV recently caught local UAW bosses Ron Seroka and Jim Modzelewski — both of whom make six-figure salaries — on tape squandering thousands of hours of overtime on such important labor security matters as on-the-clock beer runs and bowling tournaments.

And that's not even getting into the union-owned golf courses and other golf-related expenses.

Losing That Old-Time New England Feel

Justin Katz

Damien Baldino worries that Obama "stimulus" largesse may spell disaster for Providence's character:

Once Barack Obama is sworn in as President of the United States, his first priority will be a stimulus package to help the economy. I've seen amounts ranging from $600 billion to $1.3 trillion, but the most common estimate seems to be around $800 billion. The money would be used to finance transportation projects, green energy projects, and rennovation/rebuilding schools. Massive amounts of money will be funneled to cities and states to complete infrastructure projects that are in the planning stages. ...

I fear that the money would be used by the city to implement the ideas published in the DeJong study.

If you're not familiar with the DeJong study, it is essentially a study championed by David Cicilline and Donnie Evans which addressed the condition of Providence's educational facilities and how the system could be reconfigured and improved (link below). To summarize, the study had a strong bias toward rennovating historic schools and favored demolishing historic buildings and replacing them with new buildings that will probably be as awful as some of the City's other new schools. Many of Providence's schools are a mess, and they do need major rennovations, which I strongly support. What I oppose is demolishing historic buildings that could become functional and beautiful at a cost that is likely equal to, or below the cost of new construction.

I'm not very familiar with the personalities involved in Providence, but Rhode Islanders in general are a conservationist lot. Although, we also have a talent for extracting losses from win-win circumstances. (By which I most certainly do not mean to suggest that pouring taxpayer money into misguided "stimulus" packages — or politician-and-public-sector wish lists — is a win by any stretch.)

Another Year Come and Gone

Justin Katz

Busy as we are — and, of necessity, reluctant to sign up for long-term contracts, as for oil — we found ourselves today on the verge of an empty oil tank, with a delivery already scheduled for tomorrow. As one might expect, few of the oil companies that we called answered, others could not come out for days, and a couple told us that they don't make emergency calls until the tank is entirely empty.

The kind woman at Heritage Oil, however, informed me of something that I'm surprised not to have known: That diesel fuel will work in a pinch. She even made sure that I was aware that I'd need virgin gas cans that had never been used for regular gasoline. So, off to Walmart, where the cashier wished me a happy new year. "It can't be worse than the last," she said.

Well, I don't know about that.

The first half of 2008 was a hopeful, if stressful, time for me. I was advancing quickly in the construction field, and whole new career paths were coming into view. I was able to meet my bills well in advance, and things looked likely only to improve.

The year has gone out on a decidedly down note, though, with a return to my usual state of being — by which I mean a return to paycheck-to-paycheck survival. I've even trimmed personal luxuries, such as flavored beverages with lunch, from my lifestyle.

Some of you will know how difficult it can be to live on the financial edge. A distracted glitch in one's financial system brings a wave of unaffordable fees, because no buffer exists. The considerations that must be kept always in view — such as home heating oil — emerge as more numerous than seems to be the case when resources tie up loose ends before they are truly severed. The minor inconveniences mount until their aggregate effect is dispiriting: a broken car door handle, a toilet that flushes only every other time, an old electrical system that often trips in the middle of microwave cooking, a basement sink pump that fills and expunges at a glacial rate. These things are all easily fixed with a minor application of time and money, but both are in short supply.

And then there's illness and injury. A broken bone in an active child can make a paycheck disappear without warning. Flus and coughs can cost in time and motivation. I spent much of Christmas Day returning to bed and sleeping on the couch. The daily schedule by which I feel life to be advancing has come up against the motivation-sapping effects of the worst illness I can remember since college, over the past couple of weeks.

Yet, things could be much worse, and there's always reason to remind one's self that they can get much better quickly. What will the new year bring? Probably good and bad. That's all that it's reasonable to say. We define our goals, develop our strategies, and do our best to build a structure by which to capitalize on the drifts of luck and blessing that ultimately determine our fortunes.

I hope you are entering the new year with determination and optimism. It would be naive to declare that it can't be worse, but it would be unnecessarily pessimistic to forget that it truly could be better, often in ways unexpected. And behind all the comforts and travails of life, a divine infinity transforms it all to bliss.

Abandon Hope All Ye Who Run for Office

Justin Katz

Is it me, or is the continued media harassment of the Palin clan beginning to seem like a more general warning:

Alaska Gov. Sarah Palin says her future son-in-law is not a high school dropout as the press is reporting. ...

Palin said some media outlets also are erroneously reporting that her 18-year-old daughter, Bristol, is a high school dropout. The governor said her daughter is enrolled in regular high school and has taken correspondence courses.

Beware, you ordinary (right of center) Americans who are not from the political class: Your lives will undergo tabloid treatment, even from ostensibly respectable news wires, should you find success running for office.

"The fire codes are still outlandish"

Monique Chartier

So sayth Justin. And with that adjective, he understates the case.

In 2003, before (before) the new fire codes uselessly promulgated as a result of the Station Night Club fire went into effect, Rhode Island had the highest per capita expenditure on fire prevention. Imagine how much higher that number now is and how much more burdensome those regulations.

Conceptually, whether it's a fire code or a building code, we can have no end of regulations and corresponding construction or retrofit requirements to make us so safe as to approach infinity. There is a point at which the resulting cost renders the buildings too expensive to buy or rent or, minimally, places a heavy, unwarranted burden on an economy.

In practical terms, our expensive fire codes and fire prevention infrastructure proved completely irrelevant to three hundred people in West Warwick. Mountains of expensive fire codes are useless if not enforced (and if an Attorney General then does all in his power to shield the fire official from the legal consequences of such a fatal dereliction of duty).

The new fire code, built on an already excessively burdensome fire prevention infrastructure, became yet another regulatory/fiscal cudgel with which the General Assembly pounded Rhode Island businesses. Inadvertantly and with all good intention, some might point out. Yes, but weren't most of the laws and regulations - including tax laws - that have unnecessarily rendered Rhode Island all but unfit in which to operate a business pass innocently and with good intention? That in no way diminishes the considerable damage that they have wrought and continue to work on Rhode Island's economy: insufficient numbers of desireable corporations, the attendant dearth of good paying jobs, first into a recession, high unemployment rate, nightmare flashbacks for the CEO of a large corporation, et cetera.

Benefiting the Community

Justin Katz

Harvey Waxman, of Wickford, makes a good point:

When private-sector unions make concessions their sacrifices will go to companies whose executives often make millions in salaries and to shareholders whose dividends can benefit from those concessions.

When a public-sector union makes concessions the beneficiaries are not high priced executives but the people, the homeowners, the citizens of Rhode Island. That is an important difference.

One could quibble with the fact that Harvey doesn't treat shareholders as "people, homeowners, and citizens," which clearly they are (and not all rich, either), but the sentiment came to mind when I read of financial problems in Woonsocket:

Leaders of the police and fire unions said Menard has told them that, unless they make contract concessions in areas including health benefits, the city may have to lay off about 30 of the 99 police union members and 45 of 132 firefighters union members to balance the city's $116-million budget.

Union leaders in both departments said cuts of that magnitude would be devastating.

"It's a tragedy waiting to happen," Steven R. Reilly, president of the Woonsocket Firefighters Association — Local 732 of the International Association of Fire Fighters — said after addressing the council Monday night.

"I've got people here wondering if they have a job," said Sgt. John Scully, president of Local 404, International Brotherhood of Police Officers.

It sounds to me as if Mayor Menard was telling the union leaders that they have it within their power to avoid that tragedy in waiting. Unions act collectively when they're trying to negotiate for evermore; they should also act collectively when it comes to preserving each other's jobs.